YMCA E-Store / Services Annual Report 2018

YMCA E-STORE

ANNUAL REPORT 2018

YMCA E-Store is wholly owned by YMCA Associations Australia wide, launching in 2003, to be the shared services entity for the organization, incorporating a merchandising and sourcing function, on line retail, member benefit programs, National Procurement functions, Member to Member services and as the National sponsorship vehicle. At the time of conception it was acknowledged that the YMCA was an iconic brand and logo that had never been marketed to its full potential.

Over the journey E-Store has evolved to be just the merchandising arm for the organisation, however their remains an appetite and determination for the company to attain its original programs and be the vehicle to unite our organization as One Y. The purchase of YMCA Gear products helps the YMCA support the empowerment of inspired young people.

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TABLE OF

CONTENTS 4 A MESSAGE FROM OUR CHAIRMAN AND OUR CEO 5 BOARD OF DIRECTORS 8 MEET OUR STAFF 10 SHAREHOLDERS INFORMATION 12 SALES PERFORMANCE 13 CURRENT SHAREHOLDINGS 14 - 24 FINANCIAL REPORT 25 SHARE VALUATION ADVICE 26 VALE - TIM GOODFELLOW

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33

A MESSAGE FROM

OUR CHAIR

On behalf of the Directors, I am pleased to report that our Operating Profit for FY 17/18 was $165,582. The result was in line with the Company’s budgeted expectations and an improvement on the FY 16/17 result of $147,133.

As Chair of YMCA E-Store Pty Ltd, I would like to acknowledge the significant input of my fellow Directors, and also acknowledge the commitment of Past Presidents and Directors of the Company.

The Company has traded profitably for more than 12 consecutive years and demonstrates that such results are worthy of our Shareholders investment. We intend to build on our performance to reward your support.

I would also like to acknowledge the tremendous efforts of our Executive Team in delivering consistent performance in a dynamic and changing marketplace. YMCA E-Store continues to be a valuable contributor to the Movement with substantial revenue opportunities as well as the development and delivery of new and innovative products to meet the needs of our Organisation.

At the same time, we have been developing products that enable our brand to reach beyond the boundaries of our places of operation. And we are excited by the prospects before us in external markets here & off shore. Simon Hammond (Be Brands) has also been engaged to work with us on the further development of these exciting product opportunities.

We have equally been active in building relationships with other Non Profit Organisations to provide them with innovative product solutions for their enterprises. A good example of this is the partnership we now have with the Australian Children’s Foundation, as their preferred supplier and national warehousing/ distribution solution.

Whilst acknowledging our performance and progress, it became apparent during this year that the Company needed to be open to, and embrace substantial change in order to better partner with the Movement and be the platform to launch procurement across more categories than merchandise. We acknowledged the great work being undertaken by many Associations to collaborate and explore the benefits of working together; initially in key areas of procurement. The Board & Executive Team recognised that YMCA E-Store could provide more benefit to the Organisation in aiding the establishment of an entity that serviced multiple areas of procurement and was perfectly positioned to do so with a strong balance sheet and an experienced, committed Executive Team. In fact, this was exactly what our Founding Board and Shareholders had in mind over 15 years ago.

Throughout our process to implement positive change, we commit to greater engagement, communication and collaboration. We are excited by the future and will be work hard to ensure the value we provide exceeds your expectations both as recipients of our goods and services but also as Shareholders in our collective enterprise.

DONNA MCMASTER, CHAIRMAN

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FROM THE

CEO’S DESK

As Chief Executive Officer, I am pleased to report that the business attained the budgeted expectations for the 2017-18 period. In assessing the business landscape, both Board and Management are pleased to report increases in both income and profits. This has been attained by developing new partnerships and developing new products.

Over the past twelve months we have continued to upgrade site merchandise facilities by investing in new and innovative shop fronts, improving imagery and developing both plano-grams and local retail business plans with supportive centres. We have employed additional resources to represent the company, with the inclusion of experienced merchandisers, experienced product developer and further marketing support. These initiatives have enabled direct sourcing from overseas, thus attaining products with a better margin, to improve profits.

We continue to provide resources to the movement, through donations, and discounts, acknowledging that company distributions have been withheld to reinvest, reinvigorate and revitalize the company, to position us for greater opportunity as the possible joint internal entity, offering a range of national services to the movement. Throughout the past twelve months we have contributed in excess of $150k of product to assist local YMCAs with their objectives. Finally on top of all the aforementioned benefits we have increased the value of shareholdings from $100 a share in 2003 to $386 a share today. This represents a growth of more than 266% increase in 15 years or an annual return of 19% per annum on your original capital investment. This consistent performance relates directly to the consistent annual profits of, on average 180k per annum over the journey.

In closing let me take the opportunity to thank you the customer, our tireless Board of Directors and my staff for all your concerted efforts to propel the company, the brand and the greater Y. MARK SARGENT, CHIEF EXECUTIVE OFFICER

In 2018 YMCA E-Store produced over 12,000 customised garments for various YMCA organisations and programs including: the YMCA World Council, The YMCA Global Challenge, Youth Parliament, the YMCA Cancer Survivors Program and many more

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BOARD OF DIRECTORS MS. DONNA MCMASTER, CHAIR Donna is a senior Retail Executive with over 30 years’ experience, the majority at senior, strategic levels within public & private companies. Her broad commercial experience in merchandise, marketing, logistics, store operations, human resources, leasing and property development has been pivotal to her leadership success.

Donna is an inaugural winner of the Telstra Business Women of the Year Award (private sector) which is complimented by an Executive MBA from the University of Virginia (USA) and has also successfully completed Strategic Planning and Leadership programs at Monash and Deakin Universities. Donna is a Graduate & current member of the Australian Institute of Company Directors and is Chair of a School Education Board & Non-Executive Director of Dandenong Market Pty Ltd. MS. CELIA RUANE Celia is a Senior Product Manager with Redbubble, an online marketplace for print on demand products, that features artwork by thousands of independent creatives. With experience across apparel manufacturing, wholesale, retail and online, Celia has developed strong competencies in product development and category management.

“I am excited by the opportunity to contribute my skills to assist YMCA E-store, to develop strategic plans that ensure quality Y branded merchandise is the first choice by members, at all of our centres and beyond.”

MR. EDMUND WONG Edmund is a highly successful and results driven Director with an outstanding record in growing businesses and developing new routes to market. He has strong business acumen and leadership skills, with experience in leading teams and relating with key shareholders. Key competencies include strategic planning, e-commerce strategies, marketing and product positioning, developing new channels to market, sales strategies and communication. Edmund’s professional experience spans various roles with Hewlett-Packard including Worldwide Marketing, Global Operations, Mobility Solutions, Sales and Business Development, and he is currently the Vice President Tax and Accounting with Thomson Reuters in Melbourne.

MR. PETER MALONE Peter Malone has served the YMCA at a local, National and International levels in varying key roles throughout his engagement. Peter is the current Vice President of the YMCA Australia, current Chair of the Constitution Committee of APAY, current Chair of the Licensing and Member Development Sub-committee, and recently retired as a long term Director with YMCA of Bendigo. Peter commenced his involvement with the Y as a board Director with Eaglehawk YMCA, going on to serve the organisation as an interim CEO. Peter brings to the table significant skills in organisational development, project management, correctional behaviour as well as an extensive knowledge of the brand and associated intellectual property.

MS. MELINDA CROLE Melinda is the National CEO of the YMCA in Australia appointed in November 2016, after over 10 years serving the YMCA. Prior to being appointed National CEO, she was Executive Manager, Licensing and Development for YMCA Australia. Throughout her career, Melinda has had the opportunity to work across many general areas of operational and strategic management including direct business planning, human resource management, financial management and risk management in a national not-for-profit/community environment.

Melinda serves on several NFP boards and her formal qualifications include a Bachelor of Science (Biotechnology), Graduate Certificate in Management, a Diploma of Social Science and is a graduate and member of the Australian Institute of Company Directors.

MS. SHONA CASEY-ELAND Shona is the CEO of YMCA Geelong Inc & Geelong and District YMCA Youth Services. YMCA has been part of Shona’s life since commencing in 1998. The journey has seen her manage several significant areas within the YMCA, including access and inclusion, which saw her awarded the YMCA Australia program award in 1995 for her work in the area of Communications, Policy and Governance. With a strong background in governance, policy development, strategy and communications.

Shona believes that E-store can deliver a strong commercial operation with returns to the YMCA shareholders through the implementation of the strategic plan and believe her skills, expertise and understanding of shareholder engagement experience will add value to the oversight, insight and foresight of YMCA E-store.

MS. LEISA HART Leisa Hart is a successful global executive leader with an impressive 30-year track record across IT, HR and not-for-profit community organisations. Leisa has significant operational experience having worked for organisations such as IBM and Telstra as Chief Operating Officer for an ICT acquisition. In 2009 Leisa joined Mission Australia to lead the Employment Services Division and was promoted to Chief Operating Officer to consolidate Mission Australia’s key national, commercial and support services. In 2013 she joined MAX Solutions as the Director of Operations for Employment Services, Training and Health Divisions. Since 2014 she has been the CEO of YMCA NSW and has strengthened the organisation with a focus on creating safe environments for children, young people and vulnerable adults.

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The development of our own range of quality designer swimwear has allowed Centres to meet customer demand with competitively priced garments available exclusively in YMCA Centres.

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MEET OUR STAFF MARK SARGENT, CHIEF EXECUTIVE OFFICER Mark has been CEO of E-Store since 2004, and continues to lead the company to the successful position it is in today. With a YMCA career now spanning 30 years, Mark has maintained management roles in just about all facets of the YMCA business enterprises, including camping, recreation management, marketing, sponsorship, procurement, training and program development. He continues to strive for excellence on behalf of the Directors, shareholders, management, staff and customers.

TIM BURMEISTER, BUSINESS MANAGER Tim joined YMCA E-Store in July 2015, after having started originally with the Victorian YMCA back in 2001 as Business Manager at the Casey ARC. He was instrumental in the role out of the Links POS system across the State, and has had various roles in the Finance area from Group Accountant to Regional Finance Manager. Tim’s working knowledge of Centre operations make him an integral part of the organisation into the future as we look to integrate YMCA E-Store operations into a more streamlined offering to the wider organisation.

EARL MCMILLAN, DIGITAL DESIGN COORDINATOR Earl joined E-Store in 2015 after completing a Bachelor of Design (Multimedia Systems) at RMIT University followed by a year at Carlton Football Club as a Multimedia / Graphic Designer. As digital design coordinator, his key roles includes, art development, product and art design, print management, event art design and customised work. Earl also assists with maintaining and improving I.T and website programs.

STUART NORMAN, WAREHOUSE MANAGER Stuart brought a wealth of knowledge and experience in all areas of warehousing and logistics after a career spanning 15+ years in the industry. He previously managed production for large warehouse operations, and was appointed our Warehouse Coordinator in early 2014..

NATALIE PETERSON, NATIONAL SALES MANAGER Natalie joined E-Store in early 2018 and brings extensive knowledge of sales, retail and merchandising.

Natalie has primarily worked in the swimwear industry for nearly 20 years.

DAVID BEACH, NATIONAL SALES MANAGER David joined YMCA E-Store early in 2011 as State Sales Representative, after working for the Eastern Ranges Football Club as marketing and sales manager. Over the past seven years, David has improved relationships and assisted in the development of retail outlets throughout Australia, before leaving to continue his career with partner brand Speedo.

KIRSTY WEINROWSKI, FINANCE & ACCOUNTS SUPPORT With experience in accounts, administration and purchasing, Kirsty has become an integral component of the company structure and has used her skills to develop systems and procedures within the office & warehouse. She has previously worked in small business, and specialised in reconciling accounts and streamlining processes.

ASHLE HAMILTON, PRODUCT DEVELOPER Ashle joined E-Store in 2017 fresh from a 2 year assignment at UK fashion house Sunuva where she was responsible for the development of their beachwear, swimwear and accessories collections. Ashle brings a wealth of knowledge and experience in both design and production, which has seen her take the lead in developing and delivering our new ranges of swimwear, aquatic hardgoods and merchandise.

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E-STORE

INNOVATION E-Store innovation has seen the culmination of two state of the art, unique products that are currently being progressed for internal and external markets. Both products have been developed from staff and customer feedback.

Aqua Bubs - Swim Nappy – This is an improved version of current market offerings providing sustainable, re-useable, wash and wear fabrics, ideal for the busy parent. This robust product assists parents taking babies camping, swimming and playing. The product is a great alternative to disposable nappies that pollute the environment.

Thermoflex Hybrid Thermal Rash Vest – Again first to market with innovation designed for any swim teacher that works for hours in the pool. The vest is a combination of PBT fabrics that allow freedom and flexibility coupled with the thermal values of Neoprene to keep teachers comfortable and warm.

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SHAREHOLDERS

INFORMATION “Show me the Money!”

Most of the commentary in recent reports has been in regard to the increase in Shareholder equity and Dividend performance, without showing the benefit to the individual Centres. A fresh look at the figures for the last 5 years highlights that YMCA E-Store and Partner Brands have contributed potentially $9mil in sales revenue to the movement, which has gone directly to the bottom line of all Associations, assisting Centres to meet their annual budgets in this competitive marketplace. We embarked on a program of Retail space development in several key locations, with improvements to merchandising, signage and product mix, which has seen 50% increase in Retail sales. A measured approach of a well laid out Retail space combined with good quality and reasonably priced stock has proven to increase net revenue performance, without the high staff ratios required for the main income streams at most Centres.

YMCA ASSOCIATIONS RETAIL REVENUE

2013-2014

2014-2015

2015-2016

2016-2017

2017-2018

Why Re-invent the wheel?

YMCA E-Store Pty Ltd has been set up as a wholesale operation tailored to the specific needs of YMCA Associations Australia wide, for the benefit of all YMCA’s. Using a mix of local and overseas suppliers, we provide high quality, reasonably priced garments and goods which cater to the requirements of a wide variety of stakeholders. We have transitioned from external suppliers of local and overseas content, to our own entry into the overseas market with an internal Procurement operation now designing hardgoods and garments in-house, and sourcing products directly from overseas suppliers. This process has included setting up an Ethical sourcing model, which adheres to both Australian and International standards and conventions.

Associations around Australia have utilized the services of the in-house design team to assist with programs such as YMCA World Council & YMCA Global Challenge, as well as the very successful Youth Parliaments around Australia. YMCA Australia entrusted YMCA E-Store with the print and merchandise collateral for the National AGM and YMCA Awards, and we were able to deliver on several high volume print jobs such as the Children’s Services Family handbooks and the Safeguarding Children and Young People Policy.

DID YOU KNOW? • We are a stock fulfillment company with fully integrated brand solutions • We operate logistics for YMCA and other NFPs like ACF. • We have full product capabilities incorporating concepts, art, design, sampling, sourcing, production, import, warehousing and distribution.

• We distribute both nationally and internationally daily • All excess production is donated to local charities and to our communities • We offer a range planning service

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• We provide for all custom requirements • We assist YMCAs to maximise their retail potential • We abide by all ethical supply requirements, meaning our supply partners are accredited with WRAP, FEDX and third party manufacture agreements, that include child labour laws • All inks used in manufacture are biodegradable • In the past year our YMCA Gear website has had over 27,000 visits in over 80 countries worldwide • We process an average of 9 online orders per day • Our website is fully optimised for mobile devices and tablets

SALES PERFORMANCE ANCILLARY

APPAREL

CUSTOMISED

MERCHANDISE

$50,085

$142,106

$380,509

$152,974

PARTNER BRANDS

PRINT

SPORTING GOODS

UNIFORM

$85,929

$433,877

$663,743

$1,118,397

63%

37%

TOTAL SALES

$3,034,620

YMCA VS PARTNER BRANDS

BRAND DEVELOPMENT Simon Hammond and the Be Counsel The Board and Management of YMCA Estore have sought the professional services of Simon Hammond and the Be Counsel to review our collective Brand with a view to develop a marketable alternate utilising our belief and our history for inspiration.

From this platform we have aligned our thinking with the National Brand Architecture, to commence development of a stand alone youth Brand. From our collaborations, we have come to a position where we have agreed to progress concepts and considerations to design and development.

“The YMCA needs a new stand alone youth brand that enables a powerful and relevant expression of the Y belief that is valuable and sought after by the young people we seek to serve. This must be something beyond serving the needs of the Y. It must be a bold way to express the belief of the Y through what young people wear.” Simon Hammond.

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CURRENT SHAREHOLDINGS YMCA of Perth Inc

200

Bendigo Regional YMCA

213

The Young Mens Christian Association of Canberra Incorporated

100

The Young Mens Christian Association of NSW

230

The Young Mens Christian Association of Ballarat

200

The Young Mens Christian Association of Stanthorpe Inc *

60

The Young Mens Christian Association of Brisbane

640

Victorian State Council Of YMCA Inc

500

The National Council of the Young Mens Christian Associations of Australia

1441

The Young Mens Christian Association of Manningham Inc.

200

The Young Mens Christian Association of Whittlesea Inc.

63

YMCA of Northern Territory *

80

YMCA of Hobart

10

YMCA of Geelong

10

YMCA of Inner North East of Adelaide Inc.

10

Grampians YMCA

25

YMCA of South Australia Inc.

78

State Council of YMCAs of Queensland

75

Total Shareholdings

4135

* The Young Mens Christian Association of Stanthorpe has ceased operation and YMCA Australia will be seeking permission from the Board to take up the available shares.

* YMCA of Top End Inc, YMCA of Central Australia Inc, & YMCA of Katherine amalgamated during the 2017/18 year, and their shares have been combined under the new entity YMCA of Northern Territory.

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13

FINANCIAL

REPORT

Your directors present their report on the company for the financial year ended 30 June 2018.

DIRECTORS The names of the directors in office at any time during or since the end of the year are: Donna McMaster

Leisa Hart (Resigned May’18)

Edmund Wong

Celia Ruane

Melinda Crole

Peter Malone

Shona Eland

Tim Goodfellow (Resigned Nov’17)

Directors have been in office since the start of the financial year to the date of this report unless otherwise stated.

REVIEW OF OPERATIONS The profit of the company for the financial year amounted to $165,582 (2017 - $147,133) SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS No significant change in the nature of these activities occurred during the year.

PRINCIPAL ACTIVITIES YMCA E-Store Pty Ltd is the merchandising arm of YMCA Australia focused on supplying quality sportswear and uniforms to YMCA member Associations. No significant change in the nature of these activities occurred during the year.

EVENTS SUBSEQUENT TO THE END OF THE REPORTING PERIOD No matters or circumstances have arisen since the end of the financial year which significantly affected or may significantly affect the operations of the company, the results of those operations, or the state of affairs of the company in future financial years.

LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPERATIONS The board is investigating the potential for the company to operate as the national procurement company for YMCA Australia. If the proposal goes ahead, the company will likely commit a significant portion of its surplus funds to this project.

Other than this, likely developments in the operations of the company and the expected results of those operations in future financial years have not been included in this report as the inclusion of such information is likely to result in unreasonable prejudice to the company.

DIVIDENDS On the 21st July 2017, the company paid a dividend of $20.16 per share, totalling $83,361. The Company is investigating future expansion opportunities and has not declared a dividend payment for the 2017 Financial Year.

Auditor’s Independence Declaration A copy of the auditor’s independence declaration is set out on page 4 This directors’ report is signed in accordance with a resolution of the Board of Directors:

Director Donna McMaster

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Dated this 26th day of September 2018.

FINANCIAL

REPORT

AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION 307C OF THE CORPORATIONS ACT 2001 & THE AUSTRALIAN CHARITIES AND NOT-FOR-PROFIT COMMISSION ACT 2012

TO THE DIRECTORS OF YMCA E-STORE PTY LTD

As lead auditor of YMCA E-Store Pty Ltd for the year ended 30 June 2018, I declare that, to the best of my knowledge and belief, there have been; (i) no contraventions of the auditor independence requirements as set out in the Corporations Act 2001and the Australian Charities and Not-for-profits Commission Act 2012 in relation to the audit; and (ii) no contraventions of any applicable code of professional conduct in relation to the audit.

BDO East Coast Partnerships Chartered Accountants

RICHARD DEAN Partner Dated this 26th day of September 2018.

DIRECTORS DECLARATION FOR THE YEAR ENDED 30 JUNE 2018 In accordance with a resolution of the directors of YMCA E-STORE Pty Ltd, the directors have determined that the company is not a reporting entity and that this special purpose financial report should be prepared in accordance with the accounting policies described in Note 1 to the financial statements.

The directors of the company declare that: 1. The financial statements and notes, as set out on pages 6 to 17 are in accordance with the Corporations Act 2001 and the Australian Charities and Not for Profit Commission Act 2012 and: a. Comply with Australian Accounting Standards; and b. Give a true and fair view of the company’s financial position as at 30 June 2017 and of its performance for the year ended on that date in accordance with the accounting policies described in Note 1 to the financial statements.

2. In the directors’ opinion there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.

Director Donna McMaster

Dated this 26th day of September 2018.

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STATEMENT OF PROFIT & LOSS FOR THE YEAR ENDED 30 JUNE 2018

Notes

2018 $

2017 $

Revenue

2

3,264,587

3,450,146

Other Income

2

-

-

Employee benefits expense

(558,586)

(449,204)

Freight & Cartage

(70,092)

(57,203)

Depreciation and amortisation expenses

(8,686)

(11,835)

Auditor’s remuneration

(7,650)

(7,250)

Net fair value movement for financial assets held for trading

(12,654)

-

(2,441,337)

(2,777,521)

165,582

147,133

-

-

165,582

147,133

Notes

2018 $

2017 $

Cash and cash equivalents

6

493,997

980,661

Trade and other receivables

7

314,873

403,267

Inventories

8

747,156

579,696

Financial assets held for trading

9

388,086

-

2,063

4,845

1,946,175

1,968,469

32,480

37,440

32,480

37,440

1,978,655

2,005,909

Other Expenses Profits from Operations Other Comprehensive Income Total Comprehensive Income STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2018

ASSETS CURRENT ASSETS

Prepayments TOTAL CURRENT ASSETS NON-CURRENT ASSETS Plant and equipment

10

TOTAL NON-CURRENT ASSETS TOTAL ASSETS LIABILITIES CURRENT LIABILITIES Trade and other payables

11

318,872

421,368

Provisions

12

62,746

69,925

TOTAL CURRENT LIABILITES

381,618

491,293

TOTAL LIABILITIES

381,618

491,293

1,597,037

1,514,616

314,500

314,500

Retained Earnings

1,282,537

1,200,116

TOTAL EQUITY

1,597,037

1,514,616

NET ASSETS EQUITY Issued Capital

16

13

STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2018

Note

Issued

Retained

General

Total

Capital

Earnings

Reserve

$

$

$

314,500

1,106,738

1,421,238

Profit attributable to members

-

147,133

147,133

Other comprehensive income

-

-

-

(53,755)

(53,755)

314,500

1,200,116

1,514,616

Profit attributable to members

-

165,582

165,582

Other comprehensive income

-

-

-

-

(83,161)

(83,161)

314,500

1,282,537

1,597,037

Ordinary

Balance at 1 July 2016

$

Shares issued during the year

Transactions with owners in their capacity as owners Dividends paid or provided for Balance at 30 June 2017 Shares issued during the year

Transactions with owners in their capacity as owners Dividends paid or provided for Balance at 30 June 2018

STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2017

Notes

2018 $

2017 $

Receipts from customers

3,338,023

3,432,438

Payments to suppliers and employees

(3,349,714)

(3,178,862)

(11,691)

253,576

Proceeds from disposal of assets

-

14,850

Payment for plant and equipment

(3,726)

(35,912)

Investment in financial assets

(388,086)

-

Net cash used in investing activities

(21,062)

(21,062)

Dividend Paid

(83,161)

(53,755)

Net cash used in financing activities

(83,161)

(53,755)

Net (decrease)/increase in cash held

(486,664)

178,759

Cash at beginning of financial year

980,661

801,902

493,997

980,661

CASH FLOWS FROM OPERATING ACTIVITIES

Net cash provided by operating activities

15(a)

CASH FLOWS FROM INVESTING ACTIVITIES

CASH FLOWS FROM FINANCING ACTIVITIES

Cash at end of financial year

6

17

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018 NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES YMCA E-Store Pty Ltd is a company limited by shares, incorporated and domiciled in Australia.

Basis of Preparation The directors have prepared the financial statements on the basis that the company is a non-reporting entity because there are no users dependent on general purpose financial statements. The financial statements are therefore special purpose financial statements that have been prepared in order to meet the requirements of the Australian Charities and Not for Profit Commission Act 2012. The company is a not- for-profit entity for financial reporting purposes under Australian Accounting Standards.

The financial statements have been prepared in accordance with the mandatory Australian Accounting Standards applicable to entities reporting under the Australian Charities and Not for Profit Commission Act 2012 and the significant accounting policies disclosed below, which the directors have determined are appropriate to meet the needs of members. Such accounting policies are consistent with the previous period unless stated otherwise.

The financial statements, except for the cash flow information, have been prepared on an accruals basis and are based on historical costs unless otherwise stated in the notes. The amounts presented in the financial statements have been rounded to the nearest dollar.

The financial statements were authorised for issue on the 22nd day of September 2018 by the directors of the company.

Accounting Policies a.

Income Tax The company was granted endorsement of a Charitable Institution to Income Tax Exempt Status effective from 1 July 2005 by the Australian Taxation Office on 18 November 2011. Consequently, income tax expense is not applicable.

b.

Inventories

Inventories are measured at the lower of cost and net realisable value. Costs are assigned on the basis of weighted average costs.

c.

Plant and Equipment Each class of plant and equipment is carried at cost less, where applicable, any accumulated depreciation and impairment losses.

The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be received from the assets employment and subsequent disposal. The expected net cash flows have been discounted to their present values in determining recoverable amounts. d.

Depreciation

The depreciable amount of all fixed assets is depreciated on a straight line basis over their useful lives to the entity commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements.

Class of Fixed Asset Plant and equipment

e.

Depreciation Rate 7.4% - 37.5%

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

Impairment of Assets At each reporting date, the entity reviews the carrying values of its tangible and intangible assets to determine whether there is any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared to the asset’s carrying value. Any excess of the asset’s carrying value over it recoverable amount is expensed to the income statement.

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018 f.

Employee Benefits Provision is made for the company’s liability for employee benefits arising from services rendered by employees to balance date. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability is settled, plus related on-costs. Employee benefits payable later than one year have been measured at the present value of the estimated future cash outflows to be made for those benefits.

g.

Provisions Provisions are recognised when the company has a legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will results and that outflow can be reliably measured.

h.

Cash and Cash Equivalents Cash and cash equivalents includes cash on hand, deposits held at call with banks, other short-term highly liquid

investments with original maturities of three months or less, and bank overdrafts

i.

Financial instruments

Initial recognition and measurement Financial assets are recognised when the entity becomes a party to the contractual provisions of the instrument. For financial assets, this is the equivalent to the date that the Company commits itself to either the purchase or sale of the asset (i.e. trade date accounting is adopted).

Financial instruments are initially measured at fair value plus transactions costs, except where the instrument is classified ‘at fair value through profit or loss’ in which case transaction costs are expensed to profit or loss immediately.

Classification and subsequent measurement Financial instruments are subsequently measured at fair value, amortised cost using the effective interest rate method, or cost. Fair value represents the amount for which an asset could be exchanged or a liability settled, between knowledgeable, willing parties in an arm’s length transaction. Where available, quoted prices in an active market are used to determine fair value. In other circumstances, valuation techniques are adopted.

The classification of financial instruments depends on the purpose for which the investments were acquired. Management determines the classification of its investments at initial recognition and at the end of each reporting period for held-to-maturity assets.

The Company does not designate any interests in subsidiaries, associates or joint venture entities as being subject to the requirements of accounting standards specifically applicable to financial instruments. (i) Financial assets at fair value through profit or loss Financial assets at fair value through profit or loss are either: i) held for trading, where they are acquired for the purpose of selling in the short-term with an intention of making a profit; or ii) designated as such upon initial recognition, where they are managed on a fair value basis or to eliminate or significantly reduce an accounting mismatch. Fair value movements are recognised in profit or loss. (ii) Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are subsequently measured at amortised cost.

Loans and receivables are included in current assets, except for those which are not expected to mature within 12 months after the end of the reporting year.

Financial assets at amortised cost If there is objective evidence that an impairment loss on financial assets carried at amortised cost has been incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of the estimated future cash flows discounted at the financial assets original effective interest rate.

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018

j.

Revenue Revenue from the sale of goods is recognised upon the delivery of goods to customers.

Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the . financial assets.

Dividend revenue is recognised when the right to receive a dividend has been established.

k.

Goods and Services Tax (GST) Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the balance sheet are shown inclusive of GST. Cash flows are presented in the cash flow statement on a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows.

l.

New Accounting Standards for Application in Future Periods Australian accounting standards and interpretations that have recently been issued or amended but are not yet mandatory, have not been early adopted by the company for the annual reporting period ended 30 June 2018. The company’s assessment of the impact of these new or amended Accounting Standards and Interpretations, most relevant to the company, are set out below.

AASB 9 Financial Instruments and its consequential amendments This standard and its consequential amendments are applicable to annual reporting periods beginning on or after 1 January 2018. This standard introduces new classification and measurement models for financial assets, using a single approach to determine whether a financial asset is measured at amortised cost or fair value. Financial assets will either be measured at amortised cost, fair value through other comprehensive income (FVTOCI) or fair value through profit or loss (FVTPL). The entity has financial assets classified as held for trading. When AASB 9 is adopted, the entity will either reclassify these into the fair value through profit or loss category or the FVTOCI category by making an irrevocable election to treat them this way. No election has been made and therefore the movements in fair value will continue to be reflected in profit and loss with no material impact on future financial reports AASB 15 Revenue from Contracts with Customers Applicable to annual reporting periods beginning on or after 1 January 2018. As the Company currently recognises revenue for sale of goods to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services, no change to revenue recognition will occur.

AASB 16 Leases This standard is applicable to annual reporting periods beginning on or after 1 January 2019. The standard replaces AASB 117 ‘Leases’ and for lessees will eliminate the classifications of operating leases and finance leases. The Company will adopt this standard from 1 July 2019 but the impact of its adoption is yet to be assessed.

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018

Note

2018 $

2017 $

3,034,620

3,254,565

- interest received

3,020

4,716

- dividends received

14,858

-

3,052,498

3,259,281

- Sponsorship & rebate income

212,089

190,865

Other Revenue

212,089

190,865

Total Revenue

3,264,587

3,450,146

-

-

2018 $

2017 $

2,190,883

2,318,714

- Operating leases

74,263

74,263

- Contributions to defined Superannuation funds

56,946

36,427

- Loss on disposal of fixed assets

12,654

1,408

-

50,000

2018 $

2017 $

NOTE 2: REVENUE a. Sales Revenue: - sale of goods

Other Revenue

Other Income

NOTE 3: RESULT FOR THE YEAR Expenses - Cost of sales

- Donations – YMCA Why Not pledge

NOTE 4: ECONOMIC DEPENDENCE YMCA E-Store Pty Ltd is dependent on YMCA Associations for the majority of its revenue used to operate the business NOTE 5: AUDITORS’ REMUNERATION Remuneration of the auditor - Auditing or reviewing the financial report

7,650

7,250

- Cash at bank and in hand

296,065

354,786

- Short-term bank deposits

197,932

625,875

493,997

980,661

Cash and cash equivalents

296,065

354,786

Short-term bank deposits

197,932

625,875

493,997

980,661

NOTE 6: CASH AND CASH EQUIVALENTS

Reconciliation of cash Cash at the end of the financial year as shown in the cash flow statement is reconciled to items in balance sheet as follows:

21

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018 NOTE 7: TRADE AND OTHER RECEIVABLES

2018 $

2017 $

Trade Receivables

297,890

383,627

Accrued Income

16,983

19,640

314,873

403,267

747,156

579,696

747,156

579,696

388,086

-

388,086

-

Plant & Equipment at cost

197,863

194,136

Accumulated depreciation

(165,383)

(156,696)

32,480

37,440

Opening Balance

37,440

29,621

Additions

3,726

35,912

Disposal

-

(16,258)

(8,686)

(11,835)

CURRENT

NOTE 8: INVENTORIES CURRENT - Finished goods at cost

NOTE 9: OTHER FINANCIAL ASSETS CURRENT ASSETS Financial assets at fair value through profit or loss

NOTE 10: PLANT & EQUIPMENT

NOTE 10a: MOVEMENTS IN CARRYING AMOUNTS Movement in the carrying amounts for each class of plant and equipment between the beginning and the end of the current financial year

Depreciation expense Closing Balance

32,480

37,440

255,723

267,386

Sundry payables and accrued expenses

25,544

124,775

Payroll expenses

37,605

29,207

318,872

421,368

62,746

69,925

NOTE 11: TRADE AND OTHER PAYABLES CURRENT Trade payables

NOTE 12: PROVISIONS CURRENT Employee benefits NOTE 13: ISSUED CAPITAL 4,135 (2015: 4,135) fully paid ordinary shares 314,500 314,500

Ordinary shares participate in dividends and the proceeds on winding up of the entity in proportion to the number of shares held.

At the shareholders meetings each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder has one vote on a show of hands.

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018 Note

2018 $

2017 $

75,897

74,263

-

-

75,897

74,263

165,582

147,133

8,686

11,835

-

1,408

(Increase)/decrease in trade and other receivables

85,737

(20,163)

(Increase)/decrease in Prepayments

2,782

22,543

(Increase)/decrease in inventories

(167,460)

117,654

Increase/(decrease) in trade and other payables

(102,496)

(43,297)

(Increase)/decrease in Accrued Income

2,657

2,456

Increase/(decrease) in provisions

(7,179)

14,007

(11,691)

253,576

NOTE 14: CAPITAL AND LEASING COMMITMENTS a. Operating Lease commitments Non-cancellable operating leases contracted for but not recognised in the financial statements: Payable - minimum lease payments: - not later than 12 months - between 12 months and five years

NOTE 15: CASH FLOW INFORMATION a. Reconciliation of cash flow from Operations with Profit: Profit Non-cash flows in profit Depreciation Loss on disposal of asset Changes in assets and liabilities, net of the effects of purchase

NOTE 16: COMPANY DETAILS

The registered office of the company is: YMCA E-STORE Pty Ltd 88 Market Street SOUTH MELBOURNE VIC 3205 The principal place of business is: YMCA E-Store Pty Ltd Unit 2, 13 – 15 Hi Tech Court KILSYTH VIC 3137

23

INDEPENDENT AUDITOR’S REPORT To the members of YMCA E-Store Pty Ltd

Report on the Audit of the Financial Report Opinion We have audited the financial report of YMCA E-Store Pty Ltd (the registered entity), which comprises the statement of financial position as at 30 June 2018, the statement of profit or loss and other comprehensive income, the statement of changes in equity and the statement of cash flows for the year then ended, and notes to the financial report, including a summary of significant accounting policies, and the responsible entities’ declaration.

In our opinion the accompanying financial report of YMCA E-Store Pty Ltd, is in accordance with Division 60 of the Australian Charities and Not-forprofits Commission Act 2012, including: (i) Giving a true and fair view of the registered entity’s financial position as at 30 June 2018 and of its financial performance for the year then ended; and (ii) Complying with Australian Accounting Standards to the extent described in Note 1 and Division 60 of the Australian Charities and Not-for-profits Commission Regulation 2013.

Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the Financial Report section of our report. We are independent of the registered entity in accordance with the auditor independence requirements of the Australian Charities and Not-for-profits Commission Act 2012 (ACNC Act) and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Other information Those charged with governance are responsible for the other information. The other information obtained at the date of this auditor’s report is information included in the registered entity’s directors’ report, but does not include the financial report and our auditor’s report thereon.

Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed on the other information obtained prior to the date of this auditor’s report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of directors for the Financial Report The directors of the registered entity are responsible for the preparation of the financial report that gives a true and fair view and have determined that the basis of preparation described in Note 1 to the financial report is appropriate to meet the requirements of the ACNC Act and for such internal control as the directors determine is necessary to enable the preparation of a financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

In preparing the financial report, the directors are responsible for assessing the registered entity’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the registered entity or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the Financial Report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists.

Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report.

A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx) at: http://www.auasb.gov.au/auditors_responsibilities/ar4.pdf This description forms part of our auditor’s report.

Richard Dean Partner Melbourne, 26 September 2018

24

Tel: +61 3 9603 1700

Collins Square, Tower Four

Fax: +61 3 9602 3870

Level 18, 727 Collins Street Melbourne VIC 3008

www.bdo.com.au

GPO Box 5099 Melbourne VIC 3001 Australia

The Directors YMCA E-Store Pty Ltd Unit 2 13-15 Hi Tech Court KILSYTH VIC 3137 5 September 2018 Dear Directors, NET ASSETS In accordance with your request, we provide the following details regarding the net assets per share of YMCA E-Store Pty Ltd as at 30 June 2018. The information has been based on the audited financial report of YMCA E-Store Pty Ltd for the financial year ended 30 June 2018.

The audited net assets at 30 June 2018 $

Number of shares on issue as per ASIC records

Net assets per share at 30 June 2018

1,597,037

4,135 $

386.292

This net asset balance does not include provision for dividends, the last dividend paid that has been reflected in the financial report was paid in July 2017.

Yours Faithfully BDO East Coast Partnership

Richard Dean Partner BDO East Coast Partnership ABN 83 236 985 726 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO East Coast Partnership and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation, other than for the acts or omissions of financial services licensees.

1

25

VALE TIM GOODFELLOW YMCA VICTORIA DIRECTOR - (2006 - 2011) YMCA E-STORE DIRECTOR - (2011 - 2017) YMCA E-STORE CHAIRMAN - (2016 - 2017) Tim was a great man for whom I had the utmost respect.

I really enjoyed working with him and appreciate his commitment and determination to develop the company into what it now is.

I am deeply saddened by the loss of Tim and my thoughts are with his boys and all of his family and friends. He will be sadly missed.

- Richard Edwards, Company Chair (2003-2016) and Life Govenor.

Tim was a passionate supporter of the YMCA and his efforts and contributions should not be underestimated as he has left an indelible mark on the organisation nationally.

It is with great sadness we say goodbye to Tim and wish his family and friends our sincere condolences.

- Mark Sargent, CEO YMCA E-Store

- Peter Burns, CEO YMCA Victoria

Tim has been a long term supporter, advocate and volunteer of the Y who has always been extremely generous and giving of his time to the organisation.

I saw a man who cared deeply about making a difference to people’s lives through actions, his love for his boys, family and passion for outdoor sporting pursuits.

I’m am truly sadden by the loss of Tim as is the YMCA family

We will miss Tim.

- Shona Eland, CEO Geelong YMCA

- Michelle Bruggeman, Acting CEO YMCA Victoria

I totally loved the mental schism created by the contrasting images of Tim as the polished and sharply dressed retail executive and Tim as the pig shooter/bushman and farmer. He was one cool guy and I admired and appreciated many things about him.

He bought skills to the E-Store Board that had significant influence and contributed to the success of the business.

Tim was engaging, energetic and had a positive effect on everything he was involved in.

He will be sadly missed.

Mayor Anita Rank, Glenelg Shire Council

26

Young and wise, learning and generous, calm and confident; Tim earned the respect of everyone around the Board table.

Tim found his contribution was considerably more satisfying and amplified through YMCA E-Store where he had a magnificent impact.

We miss him dearly.

- Caz Bosch, E-Store Board Member (2003-2014), Former Chair of YMCA South Australia and Life Govenor.

The Directors, Management and staff of YMCA E-Store would like to thank the following providers for their much valued knowledge, support and assistance throughout the year.

We would also like to thank our shareholders, customers and YMCA members for your willingness and enthusiasm in promoting and purchasing YMCA branded products.

YMCA E-Store Pty Ltd t/as YMCA Merchandising 2/13-15 Hi Tech Court, Kilsyth, VIC, 3137 P: 03 8799 0000 E: estore@ymca.org.au W: ymcagear.com.au

27

YMCA SERVICES

ANNUAL REPORT 2018