ASX Announcement
18 August 2021
2021 Annual Report
Attached is Corporate Travel Management Limited’s 2021 Annual Report.
Authorised for release by the Board.
Contact details
Media enquiries: Alasdair Jeffrey, Rowland – alasdair.jeffrey@rowland.com.au / +61 404 926 768
Investor enquiries: Allison Dodd – allison.dodd@travelctm.com / +61 7 3210 3354
CORPORATE TRAVEL MANAGEMENT - ANNUAL REPORT 2020CORPORATE TRAVEL MANAGEMENT - ANNUAL REPORT 2021
annua
l
2021
report
Corporate Travel Management Limited
ABN 17 131 207 611
ANNUAL REPORT 2021
In this report
Key Financial Highlights 6
Chairman’s Report 8
Managing Director’s Report 12
Board of Directors 16
Executive Team 18
Sustainability Report 20
Financial Report 38
3 ANNUAL REPORT 2021
The Buttery Philosophy:
From transformation to taking
ight in FY22 and beyond
CTM has never been a business that sits still. Our reputation for innovation and
continuous improvement is testament to the spirit of our people. In navigating
the global COVID-19 pandemic, this spirit has never been more important to
our business continuity and our ability to support our customers’ and partners’
evolving travel needs. We call it the "Buttery Philosophy" – represented in our
mindset that will ensure our business continues to grow and evolve to meet the
challenges and opportunities of the future.
It’s time to reconnect, rebuild and reimagine the new era of travel.
4 CORPORATE TRAVEL MANAGEMENT
5 ANNUAL REPORT 2021
Key Financial
Highlights
$1.6B
$200.5M
55.4M
7.2M
$99.0M
TOTAL TRANSACTION VALUE
TOTAL REVENUE AND OTHER INCOME
STATUTORY NPAT ATTRIBUTABLE TO OWNERS
UNDERLYING EBITDA
CASH
2020 ‒ 2021 Performance Highlights
Rapid return to underlying EBITDA in 2H21
momentum strong and continuing post year-end.
CTM most exposed to regions with strongest
recovery momentum and advanced vaccine roll-out
Pro-forma 2019 Group revenue for USA / EU regions combined
was 72%, compared to more than 80% at year-end.
Environment primed for CTM market share gains
CTM’s customer value proposition of expert service, innovative technology
and ROI is highly relevant to customers in the complex recovery environment.
Strong new client wins due to enhanced reputation in this environment.
Balance sheet strength
CTM is a much larger business post-COVID-19
Estimated to be fourth largest global travel manager in the world. On a FY19 pro-forma
basis, revenue +57%* and underlying EBITDA +57%* at full recovery. Material post-recovery
*FX AUD1.00= USD0.75, GBP0.55. HKD6.00
ANNUAL REPORT 20216 CORPORATE TRAVEL MANAGEMENT6 CORPORATE TRAVEL MANAGEMENT
AMERICAS $96.0M
ASIA $18.9M
EUROPE $42.0M
$43.6M
$200.5M
TOTAL REVENUE AND
OTHER INCOME
Total revenue and other income generated by region
Corporate Travel Management operates across four continents and,
supported by our global network of partners, has the ability to service
customers in every corner of the world.
21%48% 9%
22%
TOTAL REVENUE
AND OTHER INCOME
TOTAL REVENUE
AND OTHER INCOME
TOTAL REVENUE
AND OTHER INCOME
TOTAL REVENUE
AND OTHER INCOME
EUROPEAMERICAS ASIA
7 ANNUAL REPORT 2021CORPORATE TRAVEL MANAGEMENTCORPORATE TRAVEL MANAGEMENT
Chairman’s
Report
Dear Shareholder
Year in review
operating conditions again this year, as the
travel industry continued to experience
major disruption because of government-
mandated travel restrictions, border
closures and quarantine requirements.
Despite this, there were pleasing signs of
especially in our North American, UK and
European businesses as high vaccination
rates against COVID-19 allowed travel
activity to pick up. The strengths of our
robust strategy and clear purpose allowed
CTM to protect its strong liquidity and
its largest ever acquisition and capital
raising during the year.
Financial Performance
operating environment. The Group reported
a statutory Net Loss After Tax of $55.351
million compared to the prior year loss
of $8.185 million. Excluding one-off or
non-recurring items, underlying Net Loss
Before Tax was $43.607 million. This was a
resilient performance in the face of major
disruption to corporate travel activity,
underpinned by a combination of prudent
cost management and a consistent
revenue stream from our clients in essential
industries, such as government, healthcare
and mining, who have continued to travel
throughout the pandemic.
EWEN CROUCH AM
CHAIRMAN
8 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
The Group maintained its strong liquidity
million cash, no debt and available facilities
of GBP £60 million at 30 June 2021. As a
chose to reduce the size of its credit facility
during the year.
Our revenues grew through the
year, particularly in the second half.
Management’s actions taken in FY20 to
maintain our service levels and continue
to invest in our proprietary technology
positioned CTM well as corporate travel
activity started to recover and this was
most evident in the North America and
UK markets, from which over 80% of our
revenues were derived.
Acquisitions and Capital Raising
The acquisition of US-based Travel &
Transport announced on 29 September
2020 materially enhanced CTM’s scale and
provided CTM with broader and deeper
management expertise in the North
American corporate travel market. There is
a strong cultural alignment between the
two organisations as Travel & Transport
demonstrates the same company-wide
focus on high quality service, proprietary
technology and delivering measurable
value for clients.
Following completion of the acquisition
in October 2020, Kevin O’Malley was
appointed as CEO of our North American
business with Maureen Brady returning to
America. The integration program is on
track and the combined business is well-
positioned to emerge from COVID-19 a
The acquisition was funded by a $375
million institutional and retail entitlement
offer. We were delighted by the strong
support for the capital raising and
we thank our shareholders for their
contributions. Funds raised through the
entitlement offer have also been used to
fund integration and transaction costs, as
and capacity for other acquisitions such as
Sydney-based travel technology company
Tramada, a leading provider of software
solutions to the travel industry.
business model, robust strategy and clear
purpose allowed CTM to protect its strong
undertaking its largest ever acquisition and
capital raising during the year.
9CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Sustainability
Our FY21 Sustainability Report is centred
around four key pillars, namely ‘Governance’,
‘People’, ‘Planet’ and ‘Prosperity’ and focuses
on the material risks and opportunities
that we believe will determine CTM’s
sustainability over the longer-term. We have
broadly aligned our reporting framework
with the guidance provided by the World
Economic Forum (WEF)
1
.
Our longer-term success is dependent
on meeting the expectations of our key
stakeholders. We look forward to continuing
to engage with our stakeholders on
sustainability matters to ensure we capture
their views and insights relevant to CTM. We
have made good progress in FY21 however
we recognise that we need to continue to
enhance our sustainability reporting and
capture, measurement and goal setting.
People
the health and wellbeing of our people,
our clients and our other stakeholders.
We have engaged with our clients to
understand their travel risks arising during
the pandemic, and have been providing
them with a broader range of consultancy
support beyond traditional travel booking,
reporting and supplier management.
Government support measures that were
in place in some of our operating regions
at different times during the year have
assisted in the preservation of jobs at CTM.
With many of these support measures
coming to an end during the course of the
year, we were once again faced with the
of making further redundancies, particularly
in those regions such as Asia where travel
activity remains very low.
The Board and executive team are
conscious of the impact these decisions
have on individual employees and their
families. The decisions to make roles
redundant were not made lightly. These
measures have been necessary to support
our business to withstand the impacts
of the global pandemic and to ensure
business continuity through a prolonged
and revenue, all while continuing to provide
exceptional service to our clients.
We acknowledge the challenges faced
by our staff globally and appreciate the
resilience, adaptability and professionalism
they have continued to demonstrate during
the pandemic. Throughout the pandemic
we have supported our employees with
a variety of initiatives promoting health
working arrangements, access to wellness
information, mental health tips and
techniques, together with support delivered
through our employee assistance program.
The support, understanding and loyalty of
our people is a testament to the culture at
CTM. We thank our CTM alumni for all they
have contributed to the business and look
forward to welcoming back many of them
as travel activity recovers.
Our FY21 Sustainability Report focuses on
the material risks and opportunities that we
believe will determine CTM’s sustainability
over the longer-term. We have broadly aligned
our reporting framework with the guidance
provided by the World Economic Forum.
1
World Economic Forum, White Paper: Measuring Stakeholder Capitalism: Towards Common Metrics and Consistent
Reporting of Sustainable Value Creation 22 September 2020
10
CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
On behalf of the Board, I would also like
to acknowledge the retirement of Neale
O’Connell who stepped down as Global
CFO in February 2021, with Cale Bennett
appointed to the Global CFO role effective
1 March 2021. I am grateful to Neale for his
valuable contribution to CTM and welcome
Cale’s appointment as we move forward in
the next phase of CTM’s development.
Year ahead
during the year in global responses to the
pandemic, particularly in the production
and roll-out of vaccines, deployment of rapid
antigen testing, and development of anti-
viral medications. Some countries are more
advanced in their vaccine roll-outs and have
begun to remove various travel restrictions
allowing intra-market and cross border travel
to resume as business opens up.
Our enhanced scale in North America
and UK/Europe, provides a strong
platform for the future and we are well-
positioned for recovery with a clear focus
and strategy for delivering long-term
value for our shareholders.
In closing, I would like to thank all CTM
team members. I would also like to thank
our clients and you, our shareholders, for
your continued support.
Yours sincerely,
Ewen Crouch AM
Chairman,
Corporate Travel Management Limited
18 August 2021
We acknowledge the challenges faced
by our staff globally and appreciate
the resilience, adaptability and
professionalism they have continued to
demonstrate during the pandemic.
11CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Managing
Director's Report
The team at CTM has managed the impacts
of the COVID-19 pandemic exceptionally well
swiftly and early in FY20, and maintaining
strong cash management, we were able to
mitigate the worst of the crisis. At 30 June,
reserves which ensures we can continue to
invest in developing the expert services and
travel technologies that are most relevant to
our clients in this new environment.
CTM has never been a business that sits
still. Our commitment to innovation and
continuous improvement is testament to
the spirit of our people. I am immensely
proud of what our teams have achieved
and the collaborative role they have played
in supporting our clients, each other and
supplier partners throughout the pandemic.
The pandemic continued to restrict
business travel around the world during
the year, which inevitably impacted our
the impacts of COVID-19, the Group’s
There were encouraging signs of
momentum building in North America and
currently generating more than 80 per cent
of its revenue from these regions, which are
the most advanced in rolling out vaccines
and recovering from the pandemic. Fourth
quarter underlying EBITDA for the Group
was $13.6 million, and our North America,
Europe and Australia/New Zealand regions
about returning to business travel as
pandemic restrictions ease and this is an
encouraging sign for the future of the
business travel industry.
JAMIE PHEROUS
MANAGING DIRECTOR
CTM has never been a business that sits
still. Our commitment to innovation and
continuous improvement is testament to
the spirit of our people. I am immensely
proud of what our teams have achieved and
the collaborative role they have played in
supporting our clients and supplier partners
throughout the pandemic.
12 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Travel & Transport
shareholder support of a $375 million
capital raising allowed us to acquire Travel
& Transport (USA, Europe) in late 2020, a
company with a similar culture to CTM.
The travel ‘downtime’ during late 2020 /
early 2021 allowed us to focus on quickly
integrating our teams under the CTM
brand and has positioned the business
to emerge from the pandemic a bigger
and stronger business with the ability to
support our clients’ evolving travel needs
well into the future.
Enhanced scale combined with
technology and exceptional service
With the acquisition of Travel & Transport,
we are a much bigger business. CTM is now
estimated to be the fourth largest travel
management company in the world, with
the scale and reach to service our clients
wherever their business takes them. Our
goal has never been to be the biggest,
but to be the best at what we do. We are
unwavering in our commitment to deliver
on our value proposition of providing
excellent client service, unrivalled travel
technology and measurable return on our
clients’ travel investment – and all with a
‘can do’ attitude. This value proposition
of expert service, proprietary technology
and ROI saw CTM continue to win clients
in every region as evidenced by our above
market revenue recovery.
enabled us to adapt quickly to the global
pandemic and will support us as we
continue to grow and evolve to meet the
challenges and opportunities of the future.
This agile mindset and operating structure
enabled CTM to bring new client solutions
to market at record speed during the
pandemic, including:
the integration of COVID-related
health and safety features for airlines
and hotels within our proprietary
online booking tool, Lightning
the deployment of our COVID-hub
portal to keep clients informed
of the fast-changing travel rules
and regulations to support more
informed travel decisions.
shareholder support of a $375 million
capital raising allowed us to acquire Travel
& Transport (USA, Europe) in late 2020, a
company with a similar culture to CTM.
13CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
People
Thanks to the professionalism and
commitment of our people, CTM is a highly
valued business partner for our clients. As
a Board and senior management team, we
are mindful of the impact of the pandemic
on our team members across the globe
and we are grateful for their ability to adapt
and remain focused on supporting clients.
Unfortunately, the fall-out from COVID-19 led
of the year to make some roles redundant,
particularly in Asia where travel activity
has continued to be subdued. All of the
people who left the business made valuable
contributions to CTM and I would like to
thank each one of them for their efforts.
Since we reduced the size of our workforce
in FY20, many former staff have chosen to
return to CTM as travel activity has started
to recover. This shows the strength of CTM’s
culture and I hope to welcome more people
back to our team as business travel activity
continues to improve.
FY22 – a new year and new horizons
Notwithstanding the uncertainty which
exists with government decisions on border
restrictions and their impact on travel
supply and demand, CTM is showing steady
signs of recovery. As vaccination programs
progress around the world I am pleased
to advise that through our large exposure
to North America and UK/Europe, we are
seeing increased demand for domestic and
international travel where borders permit as
The Group remains focused on managing
the business with an eye on the future.
We will continue to enhance our value
proposition to meet clients' needs across
the CTM global network while also
assessing acquisition opportunities that
support our global strategy to create more
levers of organic growth in the long-term.
The Group focused on the
following key strategic initiatives
during the year:
Continued Organic Growth
and Acquisitions:
Enhancing our value proposition
to meet client needs across the
CTM global network, including a
team dedicated to the strategic
global client segment.
Leveraging clients across all lines
of business (CTM, ETM, Leisure,
Loyalty, Wholesale).
Executing merger and
acquisition opportunities that
add scale, niche market positions
and/or geography.
Productivity and Internal
Innovation:
Internal innovation feedback
loops, to improve and automate
existing client and non-client
facing processes.
Staff empowerment to make
service decisions to drive high
staff engagement and client
satisfaction outcomes.
Strategic initiatives
The Group remains focused on managing the
business with an eye to the future.
14 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
So as we enter FY22, I would like to take
this opportunity to thank the Board,
management team and all of our team
members for their efforts in challenging
circumstances. I also wish to thank our
clients, suppliers, partners and shareholders
for your ongoing support for CTM
throughout the COVID-19 pandemic.
Yours sincerely,
Jamie Pherous
Managing Director,
Corporate Travel Management Limited
18 August 2021
Client Facing Innovation:
Expanding CTM SMART
Technology globally by
developing new tools for and
with our clients.
Through regional technology
hubs, building tools that
address local or regional
market requirements, including
COVID-19 related tools.
Leveraging our Scale and
Geography:
Capitalising on scale and our
global network, to develop and
optimise supplier performance for
our clients and the CTM Agency
Partnership Program (APP).
Continuing to demonstrate that
CTM is a valuable partner in the
global travel supply chain.
Our People:
Attract, retain and develop the
industry’s brightest talent.
Empowering our team to
support our clients’ needs.
Embracing a culture that
represents our values and
business drivers.
15CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Board of Directors
Ewen Crouch AM
Chairman, Independent
Non-Executive Director
Ewen Crouch was a Partner at
Allens from 1988 – 2013. He served
for 11 years, including four years as
Chairman of Partners. His other roles
at Allens included Co-Head Mergers
& Acquisitions and Equity Capital
Markets from 2004 – 2010, Executive
2004 and Deputy Managing Partner
from 1993 – 1996. He was a director
of Mission Australia from 1995,
including as Chairman from 2009,
until retiring in November 2016.
Ewen is a Fellow of the Australian
Institute of Company Directors and
a member of its Law Committee
and a director of Jawun. He served
as a member of the Takeovers Panel
from 2010-2015, as a member of
the Commonwealth Remuneration
Tribunal from 2015 – 2019, and as
a director of Sydney Symphony
Orchestra from 2009 – 2020.
Jamie Pherous
Managing Director
Jamie Pherous founded Corporate
Travel Management Limited (CTM) in
1994. He has built the Group from its
headquarters in Brisbane to become
one of the world’s largest travel
management companies.
Prior to establishing CTM, Jamie
was employed by Arthur Andersen,
now EY, as a qualified Chartered
Accountant, specialising in
business services and financial
consulting, notably in Australia,
Papua New Guinea and the
United Arab Emirates.
Sophia (Sophie)
Mitchell
Independent Non-Executive
Director
Sophie Mitchell has over 30 years of
corporate advisory, capital markets
and equity research experience.
She retired from Morgans in June
2019 after over a decade as an
Executive Director in Morgans
Corporate and, prior to this, she
was Morgans Head of Research.
Sophie is a Non-Executive Director
of Morgans Holdings (Australia)
Limited and the Morgans
Foundation Limited, a Board
member for the Australia Council
for the Arts, Non-executive Director
of Myer Family Investments Pty
Ltd, Chairman of Australian Super’s
Queensland Advisory Council and
was a member of the Australian
Government Takeovers Panel
between 2009 and 2018.
16 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Jon Brett
Independent Non-Executive
Director
Jon Brett was formerly an executive
director of Investec Wentworth
Private Equity Limited, and an
executive of Investec Bank (Australia)
Limited. He was also the CEO of
Techway Limited which pioneered
internet banking in Australia. Jon
brings extensive strategic, board and
management experience to CTM,
and corporate advisory.
Jon is currently Executive Chairman
of Stridecorp Equity Partners,
an AFSL licensed fund manager
specialising in private equity.
His former directorships include
Godfreys Group Limited, The Pas
Group Limited, deputy president of
the NRMA and Vocus Group Limited
since its listing on the ASX.
Laura Rufes
Executive Director
2015, was appointed an Executive
Director in recognition of her
leadership contribution. She has
global industry experience and, in
a career of more than 20 years, has
led teams across sales, account
management, operations and
technology. Laura is responsible
for all aspects of CTM’s business
performance. She joined CTM in
2010 and has been a key contributor
to its successful growth. She is
also a Director of the Australian
Federation of Travel Agents.
17CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Executive Team
Jamie Pherous
Managing Director
Jamie Pherous founded Corporate Travel Management Limited
(CTM) in Brisbane in 1994. He has built the Group from its headquarters in
Brisbane to become one of the world’s largest travel management companies.
Prior to establishing CTM, Jamie was employed by Arthur Andersen, now EY, as
consulting, notably in Australia, Papua New Guinea and the United Arab
Emirates.
Debbie Carling
CEO UK / Europe
Debbie Carling has worked in the travel industry for more than 30 years
in several key strategic and senior roles, including Commercial Director at
Britannic Travel. During this time Debbie led the setup of global brand FCM
Travel Solutions and became the Executive General Manager of Europe. In
2011 Debbie joined Chambers Travel and became COO soon after. Debbie
successfully instilled new company processes, productivity and developments
in supplier relations. In December 2014 Chambers was acquired by Corporate
Travel Management, during which time Debbie played a key role in the
successful transition. Debbie was appointed as CEO Europe for CTM in July 2016.
Cale Bennett
Global Chief Financial Ofcer
Cale Bennett joined CTM in August 2019, before becoming Global CFO in March
in the banking, entertainment, and transportation industries. Cale’s corporate
outcomes. A strong interest in technology has also led Cale to both co-found and
Finance, Graduate Diploma in Applied Finance and Investment, and Master of
Laura Rufes
Global Chief Operating Ofcer
was appointed an Executive Director in recognition of her leadership
experience and, in a career of more than 20 years, has led teams across sales,
account management, operations and technology. Laura is responsible for
all aspects of CTM’s business performance. She joined CTM in 2010 and has
been a key contributor to its successful growth. She is also a Director of the
Australian Federation of Travel Agents.
18 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Kevin O'Malley
CEO North America
Kevin O’Malley has more than 25 years of travel industry experience, and joined
CTM from the Travel and Transport acquisition in 2020. His leadership style,
industry acumen and genuine interest in the success of clients and staff make
him an integral member of the CTM executive team. Kevin is committed to
advancing the travel industry, acting as advisory board member among several
key industry groups, and also cultivates his local community by serving on several
boards for Nebraska-based educational institutions and charitable foundations.
As CEO, North America, Kevin is responsible for ensuring the highest level of
personal service, innovation and return on investment to our customers, while
joining the travel industry, Kevin worked as a CPA for both Deloitte and Lutz..
Greg McCarthy
CEO Australia & New Zealand
Greg McCarthy has extensive executive level experience in the travel industry
having held several leadership positions. He founded two travel management
companies in Australia, building them up from small operations to highly
successful medium-sized businesses, with a strong focus on customer retention
and superior service levels. Greg has worked for international airlines and held
an executive directorship in a global TMC, achieving a strong track record
delivering for customers. He was co-founder of Platinum Travel Corporation.
commencing as CTM CEO Australia and New Zealand on 1 July 2018.
Larry Lo
CEO Asia
Larry Lo is responsible for the overall management, sales operations and
continued development of strategic alliance partnerships across the Asia
region. He started his career in 1988 as a Travel Consultant and worked in
several travel companies in Hong Kong and Canada gaining an in-depth insight
into the international travel industry. Today, Larry manages the CTM business
in Hong Kong, Mainland China, Taiwan and Singapore. He currently serves on
the Executive Committee of the Society of IATA Passenger Agents (SIPA), the
Chairman of IATA Agency Programme Joint Council (APJC) and a Director of
World Travel Agents Associations Alliance (WTAAA).
19CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Our Sustainability Pillars 22
Principles of Governance 24
Planet 28
People 30
Prosperity 32
Sustainability Report
ANNUAL REPORT 202120 CORPORATE TRAVEL MANAGEMENT
Driving
sustainability
throughout
our business
Corporate Travel Management Limited is
pleased to present its FY21 Sustainability
Report.
CTM's focus on long-term sustainability has guided decision-making, particularly since
the onset of the COVID-19 pandemic. We have made decisions and taken action with a
long-term view to creating and protecting value for the business and our key stakeholders.
The pandemic has caused some sustainability initiatives to be scaled back and others
emphasised, to create a focused pathway to see us through the impact of the COVID-19
pandemic and into a successful recovery environment.
CTM has revised this Report following a review of our sustainability strategy and associated
reporting during FY21 to provide further information on the material areas that we believe
will determine CTM’s sustainability over the longer-term. This Report is a further step in our
reporting on areas critical to CTM's long-term success. In the coming year, work will continue
Our long-term success is dependent on meeting the expectations of our key stakeholders
begun stakeholder engagement and are introducing feedback processes to ensure we
capture and respond appropriately to each perspective.
21 ANNUAL REPORT 2021 21
Our Sustainability Pillars
After reviewing a number of the evolving reporting frameworks in the sustainability
ecosystem, we have broadly aligned our reporting with the guidance provided by the
World Economic Forum’s (“WEF”) report; Measuring Stakeholder Capitalism: Towards
Common Metrics and Consistent Reporting of Sustainable Value Creation due to its broad
applicability and commitment from a number of relevant bodies to WEF’s process to
develop globally consistent reporting.
The diagram below summarises our revised areas of focus based on the WEF’s four
reporting pillars being Principles of Governance, People, Planet and Prosperity. The pillars
form the foundation of this Sustainability Report and will underpin CTM’s sustainability
planning in the coming years.
People
PlanetProsperity
Our Sustainability Pillars
Governance
22 CORPORATE TRAVEL MANAGEMENT
Stakeholders and stakeholder engagement
During FY21, we reviewed how we engage with our key stakeholders given they are critical
to successfully meeting our purpose to deliver an enhanced value proposition to corporate
travellers. CTM’s material stakeholders include:
1. Our employees: past, present and prospective
2. Our clients: past, present and prospective
3. Our investors: present and prospective
4. Our suppliers and our industry partners
5. Governments and regulatory bodies in the regions we operate in
The table below sets out how we engage with each of our material stakeholder groups:
Employees
Various employee meetings, business update sessions, intranet, newsletters and a range
of other communication methods
Regular one-to-one employee and leader meetings, and monthly check-ins
Employee feedback loops including but not limited to employee engagement surveys,
employee new starter and exit surveys
Training sessions
Clients
Client feedback loops
Client surveys
Client engagement forums
Client information requests on sustainability topics
Participation in industry events and conferences
Direct engagement to understand emerging challenges and long-term needs
Investors
Direct engagement with larger shareholders and analysts
Direct engagement with proxy houses and other shareholder or investment advisors
Interim and full year result reporting and presentations
Investor roadshows
Participation in investment market events and conferences
ASX releases
Annual General Meeting
Suppliers/Partners
Participation in industry events and conferences
Discussions throughout the procurement process
Direct engagement throughout the supply contract lifecycle
Questionnaires, audits
Government
and regulatory
bodies
Membership of and participation in industry associations
Policy submissions, participation in working groups and meetings with government
Liaison with regulators in the jurisdictions in which we operate
Financiers
Direct engagement
Participation in industry events and conferences
Stakeholder Engagement methods
23 ANNUAL REPORT 2021
CTM conducted informal interactions with our stakeholders during FY21 regarding
sustainability, including many conversations on long-term sustainability issues given the
pandemic and increased importance of climate change. This report covers the material topics
that stakeholders focussed on. In FY22, we will engage with stakeholders in a structured way
on sustainability matters to ensure we fully capture their views and insights relevant to CTM.
Principles of Governance
purpose, governance framework, ethics and integrity, and risk management framework
together provide CTM’s material governance foundations required to create long-term value
for our stakeholders.
Our purpose
CTM was established in 1994 with a clear purpose to deliver an enhanced value proposition
to corporate travellers. Our purpose remains unchanged. CTM’s culture is founded on the
principle of empowering its people, through good processes and excellent training, to
deliver a strong return on investment to clients underpinned by intuitive industry-leading
technology and highly personalised service. The sustainability of CTM is inextricably linked to
our vision, mission and values summarised below.
Exceed to
Service
Excellence is a
habit not an act
Trust to
Succeed
Belief is what
makes a person,
team, company,
and community
stronger
Innovate to
Generate
Innovation in
thinking and doing
what nobody
else does
Collaborate to
Perform
Through teamwork
wonderful things
will be achieved
Our Company Values
Play to Win
People are
successful when
they have fun in
what the do
Empowered to
Achieve
The power to make
the right decision
to achieve great
results
Recognise to
Reward
Celebrate and
acknowledge
when we have
accomplished
something special
Our Vision
To be recognised as the global leader
in travel management solutions – an
entrepreneurial, innovative and inspiring
company of choice for employees, customers,
partners and shareholders.
To be travel management leaders in
all regions in which we operate, using
innovative technology to improve the
customer experience and bring positive
change to the market.
Our MissionOur Vision
24 CORPORATE TRAVEL MANAGEMENT
Governance framework
We recognise the importance of good corporate governance practices which assist in
ensuring the accountability of the Board and management of CTM to our stakeholders.
The Board regularly reviews our governance practices in light of corporate governance
developments, applicable legislation and standards, as well as stakeholder expectations.
At CTM, we believe that good governance practices are fundamental to:
the long-term performance and sustainability of CTM
the delivery of strategic objectives
contributing to the preservation and growth of shareholder value.
The Board has established the following governance framework:
Further details regarding our governance structures, including Directors’ skills, experience
and Committee memberships can be found in our FY21 Corporate Governance Statement
available on our website and in the Directors' Report contained in the FY21 Annual Report.
Day-to-day operation and management of CTM
Board
Provide leadership and set the strategic objectives of CTM
Remuneration &
Sustainability Committee
Audit & Risk
Committee
Nomination
Committee
People and remuneration
strategy and policies
Talent development and
succession planning
Overseeing sustainability
matters
Monitoring policies and
initiatives to ensure
safeguards are in place for
dealing fairly and ethically
with stakeholders
Internal controls
External audit
Financial reporting
Risk management
Monitoring health
and safety
Corporate Governance
Board and Committee
evaluation
Board skills, diversity
and renewal
Succession planning
Senior Leadership Team
25 ANNUAL REPORT 2021
Ethics and integrity
CTM has policies in place that support
its governance framework and
promote creating and sustaining
a workplace culture that supports
equality of opportunity, empowerment,
collaboration and recognition.
CTM’s Code of Conduct sets out the
ethical and responsible conduct expected
of all our employees and Directors. We
promote acting in accordance with the
law; acting with honesty, integrity, and
fairness; a commitment to a high standard
of professionalism; and avoidance of
and Directors. Our reputation as a fair
and ethical organisation is important to
our ongoing success. At CTM we have in
place internal grievance and investigation
processes as well as the Whistleblower
Policy and process. Internally, a breach
of the Code of Conduct could result in
disciplinary action including termination
of employment.
Through our Whistleblower Policy and
associated processes, we aim to ensure
that our people and stakeholders
feel encouraged and supported to
report conduct which they consider
to be inappropriate.
Breaches of our policies are reported
to the Board through the relevant
Board Committees.
Everyone at CTM is required to complete
training on our core policies, including
our Code of Conduct, Whistleblower
Policy, Anti-Bribery and Corruption Policy,
Risk Management Policy, Privacy Policy,
Securities Trading Policy, Continuous
Disclosure Policy, Workplace Health and
Safety Policy, and Equal Opportunity and
Diversity Policy. We also have processes for
the delivery of annual refresher training and
require an acknowledgement of reading
and understanding our policies.
Slavery Statement which sets out CTM’s
approach to identifying, managing and
addressing potential modern slavery risks
and impacts in our operations and supply
chain. We will continue to build upon and
improve our existing risk management
and remediation frameworks as they
relate to modern slavery, and in FY22 all
of our employees will receive enhanced
training regarding CTM’s modern slavery
policies and principles so that they have a
higher level of understanding of the risks
of modern slavery in our business
and supply chain.
Further details regarding our approach
to modern slavery risks can be found in
our Modern Slavery Statement available
on our website.
Risk oversight
Risk management forms a core part of
our day-to-day business. CTM’s senior
leadership team is responsible for the
of material business risks on an ongoing
basis as well as embedding a culture
throughout CTM that promotes awareness
of potential exposures created by risk.
The material issues addressed in this
who engage regularly with each of our
stakeholder groups.
The Board is responsible for the oversight
and management of risk and is assisted
by Board Committees where required. In
performing its oversight role, the Audit &
Risk Committee:
regularly reviews CTM’s risk appetite
and risk tolerance with respect to
relevant categories of strategic and
operational risk;
monitors, reviews and reports on risks
which may impact CTM achieving
its goals and objectives, or on CTM’s
performance more generally;
assesses risks which may impact CTM’s
reputation; and
reviews actions taken by management
to reduce risk exposure.
CTM is committed to taking prompt and
appropriate action in investigating possible
inappropriate conduct to ensure that
incidents are appropriately addressed and to
stop any re-occurrence of the situation.
26 CORPORATE TRAVEL MANAGEMENT
The Remuneration & Sustainability
Committee assists the Board in relation
to sustainability risks relevant to CTM
including by:
developing long-term targets and
aspirations for sustainability and, once
in place, monitoring progress towards
achieving those targets;
reviewing the effectiveness of CTM’s
initiatives designed to support a
sustainable business; and
monitoring CTM’s policies and initiatives
to ensure appropriate safeguards are in
place for dealing fairly and ethically with
CTM’s stakeholders.
The COVID-19 pandemic continues to cause
major disruption to the travel industry
because of government-imposed travel
restrictions, border closures and quarantine
requirements. The strengths of our
business model, being:
capital light
corporate travel / essential travel clients
global geographic diversity
majority of revenue from domestic travel
meant that we were well-positioned, before
the emergence of COVID-19. We protected
position, participated in M&A opportunities
and adequately managed various risks
to our business when the global travel
industry experienced this unprecedented
disruption. Through our risk management
framework, we quickly created an action
plan and implemented a new rolling
operating framework driving accountability
and operating simplicity, with a clear
focus on cost management, employee
communications, client and supplier
Opportunity oversight
Our risk framework also enabled CTM
to be in a position to capitalise on
opportunities aligned with our strategic
direction, such as the acquisitions of Travel
& Transport and Tramada in FY21. We apply
a disciplined approach to acquisitions and
will only pursue opportunities that deliver
commercially attractive and strategic
from, our established operating capabilities.
In addition to managing our own risks, as businesses adjust to
COVID-19, we are providing our clients with a broader range of
consultancy support beyond traditional travel booking, reporting and
supplier management. We have worked hard to help our clients with
sophisticated risk management tools, including traveller tracking and
emergency communications, to enable our clients to travel more safely,
27 ANNUAL REPORT 2021
Planet
We recognise the environmental harm
that can result from business operations.
Impacts on the environment are playing an
increasingly important role in determining
a company’s “licence to operate” which, if
damaged or lost, will have an impact on
CTM and our stakeholders.
CTM’s and our clients’ long-term
sustainability are dependent on the
long-term economic health of the regions
where we operate. Thriving communities
with opportunities for economic growth,
investment and development will underpin
our clients’ travel requirements. Should
any of CTM's upstream or downstream
business activities be threatened due to
environmental impact, CTM’s longer-term
sustainability may be threatened.
Direct impact
CTM has a number of initiatives in
place to manage the size of our own
climate footprint.
We continue to partner with South Pole
(www.southpole.com), a company which
offers solutions to help organisations
meet the United Nations Sustainable
Development Goals. Through this
partnership, CTM has a policy of offsetting
100% of the carbon emissions generated by
our employees’ air travel against a range of
global initiatives.
During FY21, CTM offset 234 tonnes of
greenhouse gas emissions. Due to border
restrictions and the resulting reductions of
employee travel, this amount has reduced
from FY20 when we offset more than
1,191 tonnes of greenhouse gas emissions.
Through the offsetting process with South
Pole, CTM is able to support projects
which contribute to the regeneration and
preservation of Australian biodiversity.
In addition to our own air travel, CTM has a
direct impact on the environment from the
amount of waste we generate, the electricity,
gas and water we consume, our technology
Whilst we have not yet measured these
impacts, CTM has implemented initiatives
within the business to reduce or negate
some of our impact. Our team members
are encouraged to be mindful of our
environmental responsibility. We have taken
the following steps to reduce our impact on
the environment:
A focus on paperless processes
Shredding and recycling paper
where practical
Recycling ink cartridges
Donating or recycling old / no longer
required furniture, IT equipment and
Provision of reusable kitchen items
rather than disposable items
Participation in Earth Hour
Partnering with suppliers who meet
environmental standards
with a minimum 4 star NABERS for
Energy and Water.
Over FY22, CTM will endeavour to
extend the measurement of our own
environmental impact. With this
knowledge, CTM will review our goals
related to reducing our adverse impacts
on the environment. CTM is committed to
understanding the impact we directly have
on the environment and managing this for
our long-term sustainability.
Impact from our value chain
We are aware that the upstream and
downstream activities in our value chain
also have an impact on the environment.
In providing our services to our clients,
we are very cognisant that travel creates
impacts on the environment. Whilst we
do not provide the actual transport or
accommodation, we on-supply this to our
clients by procuring travel services on their
behalf.
28 CORPORATE TRAVEL MANAGEMENT
Also, our client’s business and core
activities may have impacts on the
environment which, indirectly, we are
enabling through the provision of travel
services. At CTM, we will assist and
collaborate with our clients to reduce our
collective environmental footprints. We
have a diverse portfolio of clients across
a number of industries, many of which
regard travel as a key success enabler.
Our approach to ensure our longer-term
sustainability is to deliver innovative travel
solutions which assist our clients to achieve
their own sustainability goals. For example,
we provide our clients with the opportunity
to offset the emissions generated by their
employees’ air travel via CTM’s Climate+
program (in partnership with South Pole).
Additionally, some of our industry partners
offer options to offset emissions directly. We
facilitate this approach through enabling our
clients to choose this option in our booking
systems at the point of sale.
In FY22, CTM will continue to engage with
our clients to better understand our clients’
objectives and to assist the informed
development of travel solutions which
reduce the impact on the environment. We
will also increase our understanding of our
suppliers’ sustainability strategies to assist
and ensure long-term sustainability for CTM.
29 ANNUAL REPORT 2021 29
People
Our people are CTM’s frontline value
creators for our stakeholders. Our long-term
creation of value is dependent on attracting
and retaining talented and motivated
staff. From a sustainability perspective,
CTM’s People initiatives focus on diversity,
health and safety, and training and
development. These initiatives alongside
our remuneration structure, policies and
procedures, ethics and integrity framework,
focus on innovation, and our contribution to
the communities we operate in, underpin
CTM’s workplace culture.
CTM has historically used employee surveys
to provide insights into workplace culture
and employee engagement. This has
included comprehensive annual employee
surveys (the Vibe Survey), new starter and
exit surveys, informal and formal complaint
handling procedures, Workplace Health and
Safety information including access to an
Employee Assistance Program, and quick
employee pulse surveys.
In FY21, CTM's annual Vibe Survey was
suspended given the sudden and
team members as we focussed on ensuring
the health and wellbeing of our people
and their families. Feedback was primarily
sourced from direct contact between
managers and their teams. Our employees
and leaders worked together tirelessly to
support each other during this time. Some
other People programs were also scaled
back during the year given their lower
priority in the pandemic environment.
In FY22, we will return to using the Vibe
metrics and benchmarks around our
understanding of employee engagement,
and we will focus on reintroducing key
People programs as our teams return to the
workplace and the business recovers.
Diversity factors
We understand that it is critical that
our most important asset - our people
- have a range of skills, experiences,
backgrounds, thoughts and beliefs. We
acknowledge the individual strengths of
each employee and the potential they
bring. Valuing the differences of others
is what ultimately brings us all together
and creates innovation through diversity
of thought. It also contributes to an
engaging work environment.
71% of our employees are female
and 29% male
Average age is 44
Average tenure is 8 years
68% of our team leaders and
managers are female, 46% of
senior leaders are female
There has been no material change to these
statistics from FY20 to FY21.
Knowledge, skills and training are critical
elements in developing and supporting a
diverse team.
With our new Global Learning
Management System, implemented in
late FY21, we have introduced new and
enhanced training relating to:
Diversity and inclusion
Equal opportunity
Unconscious bias
Becoming a Diversity, Equity and
Inclusion Ally and Agent for Change
Harassment training
Equity in relation to salary is important at
CTM, and we have processes and procedures
in place to identify, reduce and eliminate any
unconscious bias.
Each region completes an annual review
of salaries. Included in this process is the
requirement for each region to evaluate
local minimum wage requirements and
assess where our employees sit in context
to local employee relations requirements.
We also complete an annual analysis
of salaries by gender, and we support
our leaders with recommendations and
training in this area.
The information gathered is used to adjust
and set our People and Sustainability
strategies to ensure we address issues
which may impact on our ability to attract
and retain talented people.
30 CORPORATE TRAVEL MANAGEMENT
Reporting
At CTM, we submit gender diversity
information to the relevant government
and reporting bodies as required. Our
work is recognised by compliance
with the Australian Workplace Gender
Equality Act (WGEA) 2012, UK Gender Pay
Gap Reporting, US Equal Employment
Opportunity Commission - Employer
Information Report EEO-1, New Zealand
Government Employment Survey, and
others where required.
Indigenous Engagement Plan
In Australia, we continued our focus
on raising employee awareness and
understanding of traditional cultures
through our Australian Indigenous
Engagement Plan. We promote and
celebrate NAIDOC Week, with this year’s
goal to increase employees’ awareness
of Aboriginal and Torres Strait Islander
communities and culture. During FY21,
we continued our partnership with NRL
Cowboys House. This program provides
supported accommodation for Aboriginal
and Torres Strait Islander students from
remote Queensland communities so they
can access quality secondary education,
and includes separate housing for young
females. In partnership with the students
from Cowboys House, CTM produced a
video showcasing students’ traditional
languages and their importance to local
communities and heritage. CTM is also a
member of Supply Nation, an organisation
which connects Australian companies
to Indigenous suppliers, with the aim to
build a vibrant and prosperous Indigenous
business sector by incorporating
Indigenous-owned businesses into
the supply chain.
Health and safety
At CTM, the health and safety of our people
is paramount. During the pandemic we
have supported our employees with a
variety of initiatives promoting health
and mental wellbeing. These include
to wellness information, mental health
tips and techniques, and the Employee
processes have been implemented to help
protect our people, including COVID-Safe
plans, following local health authority
requirements and advice, additional
cleaning, provision of hygiene products,
and social distancing.
Across our regions we have a number of
ongoing health and wellbeing initiatives in
place to support our people:
Intranet sites dedicated to providing
information, tools and discounts relating
to health and wellbeing
Mental health training
Health challenges and programs
R U OK Day?
Employee Assistance Programs
Domestic and family violence awareness
and training
COVID-related health and wellbeing
tips and tools
As a service-centric business, our employees
work either remotely from home or within
ensuring very limited exposure to workplace
risks, incidents and injuries. During FY21 the
number of non-work related and work-
related incidents was immaterial and CTM
had no fatalities or permanent disabilities.
Training and development
During FY21 we scaled back the CTM
HiPo (High Performance) program
and other leadership development
activities and focused on operational
and process training, which was critical
in a volatile travel landscape. In late FY21,
we streamlined our compliance training
globally and launched a new global
Learning Management System to deliver
on-demand learning opportunities to all
employees. The objective of this program
and the investment in the development of
our people aims to provide:
high quality compliance training
enhanced reporting capability on
training completion
continuous learning which supports
our culture of innovation and
empowerment
an extensive library of on-demand
learning content in a variety of forms
and languages
a pro-active, personalised and
self-initiated development and
learning culture.
To remain a vibrant, sustainable sector
over time, the industry needs to continue
attracting talented people to a career
in travel. CTM is proud to support the
continued advancement of the travel
industry through ongoing skills training,
which contributes to the local economies
and communities in which we operate.
During FY21, initiatives such as the TAFE
Travel and Tourism scholarship program
in Australia, our partnership with Bradford
College (UK), and our various graduate
programs in the USA, were placed on hold
and we are looking forward to reigniting
these programs in FY22.
31 ANNUAL REPORT 2021
Prosperity
We believe the core drivers for longer-term
sustainability from a prosperity perspective
include our contribution to employment,
wealth generation, investment in
innovation, community participation and
support, including the payment of taxes,
and the protection of our stakeholders’
data and privacy.
Whilst the travel industry is traversing
its toughest period in recent times, CTM
has remained resilient throughout the
pandemic. As a result, CTM has been able to
act on opportunities to grow our footprint,
add scale and acquire talent, evidenced in
CTM’s acquisitions of Travel & Transport and
Tramada in October 2020.
Employment
In response to the pandemic and for the
sustainability of our business, CTM made
the decision to resize its workforce and
temporarily reduce pay and/or working
hours for employees to align with the
government grants available in some of
our regions, which were instrumental in
enabling us to reduce the impact on our
employees and clients.
CTM has recommenced hiring in some
regions as travel activity recovers, and
most employees have returned to full pay
and working hours.
We have been focussed on retaining
skilled and knowledgeable staff during
the reporting period to support our clients
and our business.
We again thank our alumni for all they
have contributed to CTM, and look forward
to welcoming many back to the CTM
business in the near future.
Wealth generation
We have made the decision to not
recommend dividend payments
during the COVID-19 impacted period,
resulting in a loss of income for
shareholders. We are committed to
returning value back to stakeholders
via dividends as soon as prudent.
Whilst the pandemic was an unforeseeable
event, CTM entered the period in a strong
business planning and diligent governance.
Balance sheet strength and management
were key to the resiliency of the business
through the COVID-19 affected period. As
the pandemic took hold from early 2020,
CTM’s balance sheet management has been
from the working capital unwind that had
built up prior to the pandemic. We also
cancellations occurred. We continue to see
refunds as cancellations continue to occur in
response to COVID-19 outbreaks and border
lockdowns globally. We were able to manage
these events through our relationships with
our clients, suppliers and partners. Given
on debt collection, all external debt was
repaid in May 2020.
We have maintained cash holdings through
has been drawn since it was repaid.
CTM’s debt covenants were waived by debt
through the pandemic period. As at 30
June 2021, CTM holds $92.8 million in cash
available to be used and has no drawn
debt on a facility of $110.7 million.
During June 2021, CTM reduced the facility
limit from £100 million to £60 million given
the strong balance sheet position. Looking
forward, we will continue to manage our
balance sheet positions prudently and
conservatively.
Our balance sheet management ensured
CTM did not need to raise equity capital
to fund the operations or losses of the
underlying business. Rather, we raised
capital in October 2020 to acquire Travel &
Transport and Tramada. These acquisitions
grew the pre-pandemic pro-forma revenue
by 64%. Travel & Transport gives CTM
greater access to the North American and
European markets in corporate travel.
stakeholders in the future through
increased client offerings and accretive EPS.
There have been many decisions
contributing to CTM’s corporate
performance through the COVID-19
pandemic, and we are well-positioned to
continue creating value in the future.
32 CORPORATE TRAVEL MANAGEMENT
mindful to minimise concentration of
revenues from individual clients.
‘essential services’ industries who continued
traveling through the pandemic. This
ensured continued revenues, although
lower than historic levels, during the
downturn. We are conscious that our supply
chain is a leading factor in recovery. We
have been and continue to work closely
with industry partners to ensure the best
outcome for all stakeholders both short
term and long-term. Global airline capacity
has increased over the reporting period.
Travel bubbles and quarantine-free travel
pathways have started to appear globally.
However, the countries we operate in take a
sovereign approach to border closures and
vaccine rollouts. Some regions will reopen
international travel quicker than others.
CTM has developed a strategy to operate
through this uncertain period of recovery
and into the post pandemic environment.
Economic contribution (A$m)
Australia/
New Zealand North America Asia Europe Consolidated
Direct economic value generated
1
FY21
43.7 97.6 18.2 42.0 201.5
FY20
84.6 134.3 53.2 77.8 349.9
Economic value distributed
2
FY21
66.8 150.8 33.9 47.4 298.9
FY20
77.2 137.0 72.3 79.2 365.7
Economic value
retained/(distributed)
3
FY21
(23.1) (53.2) (15.7) (5.4) (97.4)
FY20
7.4 (2.8) (19.1) (1.4) (15.9)
Core Metrics
1. Direct economic value generated represents revenue and other income from continuing and discontinued operations.
community investments.
3. Economic value retained equals direct economic value generated less economic value distributed.
Government nancial assistance by region
Monetary value
(A$m) FY21
Monetary value
(A$m) FY20
AUSTRALIA
7.8 2.5
ASIA
7.0 2.0
EUROPE
3.6 3.2
TOTAL
18.4 7.7
Core Metrics
In FY21, CTM navigated an extremely
the pandemic impact a larger and stronger
business focussed on our stakeholders and
their long-term prosperity.
33 ANNUAL REPORT 2021
Innovation of better
products and services
Innovation is at the core of CTM’s purpose,
value proposition and sustainability. The
proprietary technology we have developed
continues to improve and was an important
tool to facilitating our clients’ travel plans
from when the pandemic started to impact
travel in the second half of FY20. Our
proprietary technology continues to be core
to our client value proposition.
Decisions regarding employee reduction
did impact the software development
teams in CTM during FY21. The decision
was made to reduce technology projects
whilst we navigated the loss of activity in
order to preserve cash.
We were agile and prioritised changes to
the technology needed to supply valuable
information to our clients regarding
COVID-19-safe travel. These changes were
made quickly and ensured we were able to
provide service to those who needed it in a
safe and informed method.
As businesses adjust to COVID-19 and
changing macro trends, we are listening
to our clients’ requirements as they
return to travel. We have delivered new
solutions and technologies that provide
our clients information needed to get
back to business travel. CTM supports
our clients’ health, safety and wellbeing
through a range of products and services
including CTM’s traveller tracking tools, risk
management and communications tools,
and traveller wellbeing reporting.
We have also been working closely with
travel suppliers and governments to
prioritise the development of new solutions
which enable our clients to make more
informed travel decisions that increase
Looking forward, CTM has a Board-approved
strategic vision for the future of corporate
travel and the technology required to enable
it. As development headcount increases
along with research and development
investment, this vision will support long-
term value creation for stakeholders.
Financial investment contribution
Monetary value
(A$m) FY21
Monetary value
(A$m) FY20
Software development less amortisation
(3.5) 4.0
Acquisition of entities less distribution of capital to
shareholders
276.1 (1.2)
Total
272.6 2.8
Innovation and community contribution
Monetary value
(A$m) FY21
Monetary value
(A$m) FY20
Total development cost
14.2 18.5
Core Metrics
34 CORPORATE TRAVEL MANAGEMENT
Community and social vitality
As a global business, we empower
our employees to develop and deliver
initiatives that suit the needs of their local
communities, but are underpinned by our
broader purpose, mission, vision and values.
During FY21, initiatives were scaled
back due to various restrictions, and the
focus was on supporting our internal
communities’ health, wellbeing and
community spirit. Some of the external
initiatives supported during FY21 included:
Australia and New Zealand:
Sponsorship of Cowboys House
(supported accommodation for
Aboriginal and Torres Strait Islander
students from remote communities
during their secondary education),
fundraising for the Animal Welfare
League, and volunteering at the Street
Buffet to support people impacted
by homelessness.
Asia: The Community Chest Skip Lunch
Day in support of the homeless in Hong
Kong, and the FeiMaYi Program in
support of remote rural communities
in China.
North America: Volunteering and
support for organisations and charities
servicing women and children affected
by domestic violence, youth support,
student scholarships, homeless
services, and programs that combat
adult and childhood illnesses.
Europe: Volunteering at COVID-19
vaccination centres, fundraising for
the Marie Currie Donation Appeal, and
volunteering at the Oak Cakes Rescue
Kennels in the UK.
Tax
The Group’s approach to tax is
governed by a Board-approved Tax
Governance Framework. The Group
has robust internal tax controls and
risk management procedures in place
to enable the Group to identify and
respond to tax risk. To guide the Group’s
implemented a Tax Code of Conduct
aligned to the Group’s core values and
commitment to corporate responsibility.
Under the Group’s tax risk management
strategy, CTM will not participate in tax
evasion or aggressive tax planning, and
is committed to maintaining a proactive
and transparent relationship with taxation
authorities in all tax jurisdictions in which
the Group operates.
As a global business, CTM contributes to the
wealth of communities and society through
remitting the correct amount of taxes to tax
authorities. CTM has paid $9.1 million in tax
for FY21 (FY20: $31.8 million).
Data security and privacy
As a travel management provider, CTM
collects, uses, stores and protects large
travel bookings and associated travel. We
take information security and privacy very
seriously, and have implemented a robust
information security framework across the
entire business that includes appropriate
security policies and procedures, staff and
contractor security awareness programs,
and technical security measures.
CTM abides by the applicable privacy
legislation in all regions in which we
recognised security and compliance
standards, including ISO27001, PCI-DSS
and SOC2. In addition to these compliance
requirements, CTM strives to follow best
practice cybersecurity to ensure the
data for our customers, business partners
and employees.
Despite these measures, in FY21 CTM was
impacted by a cyber-attack in one of our
regions that resulted in the unauthorised
access to a small amount of low-value
legacy data. This attack was detected
and contained quickly, largely due to
preventative security measures already in
place, which fortunately limited both the
impact and duration of the breach.
Specialist security expertise was brought in
to assist with remediation processes, and
CTM reported the breach to the relevant
privacy regulator and impacted clients as
required by law. Following a review, and
having regard to the remediation and
prevention strategies employed by CTM,
the regulator determined that no further
action was necessary.
opportunities to reduce the likelihood
of further attacks and to improve and
enhance our cybersecurity posture. These
improvements were completed within FY21.
CTM is committed to responsibly
managing the Group’s compliance with
its tax obligations around the world.
35 ANNUAL REPORT 2021
CTM is committed to the sustainability of
the business and creating value for our
stakeholders. Since the onset of the pandemic,
focussing on CTM’s long-term sustainability
has helped our decision-making.
We have taken steps to identify critical areas to achieve long-term
sustainability and are on a journey towards improving our sustainability
reporting. In FY22, we will focus on more structured interactions with
our stakeholders to understand their perspectives on sustainability,
measuring our environmental impact, rebuilding our workforce
as activity returns, returning initiatives that were scaled back, and
increased investment in innovative proprietary technology.
Conclusion
36 CORPORATE TRAVEL MANAGEMENT36 CORPORATE TRAVEL MANAGEMENT
37 ANNUAL REPORT 2021
Directors’ Report 39
Corporate Governance 50
Remuneration Report 51
Auditor's Independence Declaration 70
Consolidated Financial Statements 72
Loss and Other Comprehensive Income 73
Consolidated Statement of Financial Position 74
Consolidated Statement of Changes in Equity 75
Consolidated Statement of Cash Flows 76
Notes to the Consolidated
Financial Statements 77
Directors’ Declaration 134
Independent Auditor’s Report 135
Shareholder Information 143
Corporate Directory 145
Financial Report
38 CORPORATE TRAVEL MANAGEMENT
(referred to hereafter as the 'Group') consisting of Corporate Travel Management Limited (referred to hereafter as 'CTM'
or the 'parent entity') and the entities it controlled at the end of, or during, the year ended 30 June 2021.
Directors
The following persons were Directors of CTM during the
except as otherwise stated.
Ewen Crouch AM (Chairman, Independent
Non-Executive Director).
Sophie Mitchell (Independent Non-Executive Director).
Jon Brett (Independent Non-Executive Director).
Jamie Pherous (Managing Director).
Principal activities
The principal activities of the Group during the year
consisted of managing the purchase and delivery of travel
in the nature of the activities of the Group during the year.
Dividends
There were no dividends paid, recommended, or
determined during the current reporting period.
There were no dividends recommended for the previous
reporting period. On 19 February 2020 an interim dividend
of 18.0 cents was determined by the Board. On 19 August
2020, the Board resolved to cancel that interim dividend
due to the ongoing impacts of the COVID-19 pandemic on
the travel industry and the Group.
Dividends of $26,456,000 were paid in the previous
for the year ended 30 June 2019.
Review of operations
The Group continued to engage in its principal activity,
being the provision of travel services, the results of which
Corporate Activity
CTM completed a capital raising during the year,
issuing 27,424,566 shares at $13.85 raising proceeds
of $379,830,000. This capital raise was undertaken to
complete the acquisition of Travel and Transport, Inc
('T&T') and strengthen the balance sheet.
Travel and Transport, Inc
The Group acquired 100% of the shares of T&T with
effect from 30 October 2020 for consideration of
US$209,897,000 (AU$292,494,000). T&T is based in North
America, with operations in Europe, specialising in travel
agency services for the corporate market.
Tramada Holdings Pty Ltd
The Group acquired 100% of the shares of Tramada
Holdings Pty Ltd ('Tramada') with effect from 29 October
2020 for consideration of $9,353,000. Tramada is a software
company focused on automation of the travel booking
process, enabling better business performance for travel
agencies and independent travel consultants primarily
in the Australian market. The Group was the largest
customer of Tramada prior to the acquisition.
Data Visualization Intelligence, Inc
CTM entered into an Asset Purchase Agreement effective
18 February 2021 for the sale of certain assets and liabilities
of Data Visualization Intelligence, Inc ('DVI'), a wholly-
owned subsidiary of CTM, for US$2,500,000 (AU$3,218,000).
CTM also has the right to receive an earnout payment
contingent on the future performance of the business.
DVI, based in North America, offered a cloud-based data
solution for insights on travel and entertainment spend.
Group nancial performance
amounted to $55,351,000 (2020 loss: $8,185,000). During
the period, the Group's result continued to be affected by
the travel restrictions and regional government imposed
lockdowns caused by the global COVID-19 pandemic with
underlying EBITDA falling by (110%) to a loss of $7,249,000.
continuing operations is set out in note 3 'Segment
In addition to the strength of the recovery in the Europe,
North America ('NA') and Australia and New Zealand
('ANZ') regions in the second half of FY21, the measures
FY21. As vaccines have been delivered and government
management approaches to the pandemic have become
known, activity has trended positively within most regions
from the lows experienced in FY20 and early FY21. Whilst
performance, the acquisition of T&T contributed positively
to the closing months of FY21 and provides a strong
The business recovery is accelerating through enhanced
scale, technology, integrated automation, and an
increasingly attractive value proposition for customers.
basis from April 2021 and remained so until the end of the
The Group ended FY21 with a strong balance sheet with
no debt and cash of $99,018,000. Through the year, a
combination of management actions and reduced travel
activity reduced outstanding bank guarantees from
$54,349,000 to $19,595,000. Executed management
actions will ensure that as travel activity recovers, issued
bank guarantees are unlikely to return to historic levels.
Directors' Report
39 ANNUAL REPORT 2021
Directors' Report
Continued
Regional operations
Consolidated Group
2021
$'m
2020
$'m Change
Reported AUD
TTV
1,609.4
4,561.8
(65%)
Revenue
174.0
316.4
(45%)
Total revenue and other income
200.5 349.9 (43%)
Underlying EBITDA
(7.2)
74.4
(110%)
Underlying EBITDA as % of Revenue
(4.1%)
23.5%
(43.6) 39.2
Australia and New Zealand
2021
$'m
2020
$'m Change
Reported AUD
TTV
442.8
958.8
(54%)
Revenue
34.6
78.0
(56%)
Total revenue and other income 42.0 81.3 (48%)
Underlying EBITDA
7.7
32.8
(77%)
Underlying EBITDA as % of Revenue
22.3%
42.1%
(3.0) 21.5
The year-on-year decrease in revenue and underlying EBTIDA in ANZ region was caused by continued government-
mandated restrictions on travel, particularly international travel. These restrictions began late in 3Q20 and continued
throughout FY21. Intermittent Australian state border closures and capital city lock-downs caused disruption to the
domestic travel industry throughout FY21. Despite this, the ANZ region’s strong domestic business driven by exposure to
essential travel clients has resulted in a resilient result, with the region maintaining positive underlying EBITDA in both
halves of FY21. A key focus of the ANZ segment in the second half of FY21 has been the matching of operational resources
with the recovering travel activity to ensure the balance between service levels and cost recovery remained appropriate.
Underlying EBITDA to Statutory Net Loss Before Tax Reconcilliation ($M)
Underlying EBITDA
($7.2)
Comprehensive Underlying EBITDA
($8.0)
Finance costs
($3.2)
($43.6)
Underlying net loss before income tax from continuing operations
($31.1)
Statutory EBITDA
Impairment
($0.4)
Integration costs
($11.5)
Gain on sale of DVI
$1.0
Other
($2.9)
Acquisition costs
($7.2)
Integration costs (impairment - right of use assets)
($0.9)
($75.6)
Net loss before income tax from continuing operations
COVID-19 - Bad and doubtful debts
($1.2)
COVID-19 - Redundancy costs
($1.3)
Amortisation - client contracts and relationships
($8.0)
Less: total EBITDA non-recurring costs
($23.1)
Add: total EBITA non-recurring costs
$23.1
Depreciation and amortisation
($32.8)
Discontinued operations
Add: Discontinued operations
($0.8)
$0.8
EBITDA non-recurring costsPBT non-recurring costs
40 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Whilst small, the acquisition of Tramada for $9,353,000 in 1H21 positively impacted the region in FY21, increasing revenue
North America
2021
$'m
2020
$'m Change
Reported AUD
TTV 755.5 1,146.3 (34%)
Revenue 92.7 113.6 (18%)
Total revenue and other income 96.0 134.3 (29%)
Underlying EBITDA (10.7) 14.7 (173%)
Underlying EBITDA as % of Revenue (11.5%) 12.9%
Underlying loss before tax from continuing operations (29.9) (0.3)
CTM acquired T&T for $292,494,000. This acquisition provides the North America region with additional scale and capability
to deliver its service and technology proposition to the large and rapidly recovering travel market in the United States. The
integration of the T&T acquisition was a key focus of the region in FY21 to ensure maximum synergies are attained when
the region fully recovers from the impacts of COVID-19.
Domestic travel activity, historically the largest revenue contributor in North America, has trended positively month on
the region rapidly increasing capacity in line with recovering market demand. Whilst the addition of T&T initially impacted
an underlying EBITDA basis late in FY21. Costs have continued to be managed tightly in line with the recovering activity,
while ensuring customer service levels remain appropriate.
Asia
2021
$'m
2020
$'m Change
Reported AUD
TTV 23.9 1,523.5 (98%)
Revenue 8.5 50.0 (83%)
Total revenue and other income 18.9 53.2 (64%)
Underlying EBITDA (5.4) 6.9 (178%)
Underlying EBITDA as % of Revenue (63.5%) 13.8%
(9.0) 2.1
Revenue in the Asia region is predominately derived from international travel with ongoing travel restrictions resulting in
losses during this low travel activity period. Government support for staff costs in Hong Kong and Singapore assisted in
increased albeit off a low base.
41CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Europe
2021
$'m
2020
$'m Change
Reported AUD
TTV 387.3 933.2 (58%)
Revenue 38.2 74.8 (49%)
Total revenue and other income 42.0 77.8 (46%)
Underlying EBITDA 10.1 26.7 (62%)
Underlying EBITDA as % of Revenue 26.4% 35.7%
7.4 24.0
The European region’s operational expertise in managing complex, cross border travel has resulted in an extraordinary
recovery during FY21. Against a backdrop of extended domestic lockdowns in the United Kingdom, the Europe region
secured several material new business opportunities, both project-based and ongoing.
The contract with the UK Government to manage the inbound quarantine hotel program and COVID-19 test kit sales
has supported the region’s FY21 result. In order to secure these contracts, the Europe team were challenged to deliver a
technology-led solution in a short time frame with the complexity of extremely high volume.
Europe region revenue more than doubled in 2H21 compared to 1H21. Costs continue to be tightly managed in the
Europe region, balanced against maintaining client service levels at an appropriate level. Consequently, the Europe
vaccination roll-out in the United Kingdom continues to be exemplary, resulting in the lifting of some restrictions late in
Group Financial Position
$851,457,000. At 30 June 2021, the Group had no interest-bearing liabilities (2020: nil), excluding lease liabilities.
Dividends
There were no dividends paid, recommended, or determined during the current reporting period.
There were no dividends recommended for the previous reporting period. On 19 February 2020 an interim dividend of
18.0 cents was determined by the Board. On 19 August 2020, the Board resolved to cancel that interim dividend due to the
ongoing impacts of the COVID-19 pandemic on the travel industry and the Group.
ended 30 June 2019.
2021 2020
Earnings per share for prot/(loss) from continuing operations attributable to the ordinary equity
holders of the Company
- Basic EPS (cents per share) (43.0) (7.5)
- Diluted EPS (cents per share) (43.0) (7.5)
Strategy and future performance
The Group's operating model is focused on the corporate
travel market and our client value proposition combines
personalised service excellence with market-leading
technology. In FY21, the Group continued to focus on its
key strategic drivers being:
sustainably expanding our global operations, driving
organic growth through operational excellence and
leveraging our technology platforms;
retaining current clients and winning new clients
through our client value proposition;
development and deployment of innovative
technology and digital initiatives ‘in region, for region’,
with a focus on delivering an improved customer
experience and internal productivity;
capitalising on our scale and global network to
develop and optimise supplier performance for
our clients;
continuing to seek selective opportunities for
mergers and acquisitions where it represents strong
value and aligns with the Group’s strategic goals;
staff empowerment to make service decisions
that drive high staff engagement and client
satisfaction outcomes.
42 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
well on these strategic drivers. Notwithstanding the
unprecedented conditions and challenges presented
by travel restrictions arising from COVID-19, the Group
maintained historically strong client retention numbers.
Further, we used our technology to drive enhanced
servicing to assist and support travellers.
The Group intends to continue to pursue the opportunity
to sustainably expand our global operations, drive
organic growth and leverage our technology platforms.
Additionally, the Group continues to seek merger and
acquisition opportunities that add scale in niche travel
sectors or which complement our existing business and/or
geographic footprint.
Material business risks
The potential material business risks that could adversely
affect the achievement of the Group’s business strategies
below. This section does not purport to list every risk
that may be associated with the Group’s business now
or in the future. There is no guarantee or assurance that
the importance of these risks will not change, or other
risks emerge. While the Group aims to manage risks in
reputational standing, some risks are outside the control
of the Group.
Travel industry disruption and impact of COVID-19
strength of the travel industry generally. A decline in the
domestic and/or international travel industry, whether as a
result of a particular event (such as a war, terrorism, health
epidemic/pandemic or a natural disaster), economic
conditions (such as a decrease in business demand),
geopolitical conditions or any other factors, will likely have
condition and operations.
The COVID-19 pandemic has caused an unprecedented
disruption to the travel industry as a result of government-
imposed travel restrictions, border closures and
detrimental impact on corporate travel services and as a
result, the Group’s earnings since March 2020.
While vaccination roll outs continue to gather momentum
around the world, as new strains of COVID-19 emerge,
there remains uncertainty as to the duration of and further
impact of COVID-19, including (but not limited to) in relation
to government, regulatory or health authority actions, work
stoppages, lockdown, quarantine, travel restrictions and
the impact on the Australian and global economy. There
is a risk that if the spread of COVID-19 continues, and/or
the border closure and travel restriction actions taken to
performance could deteriorate further.
In light of the continued uncertainty around recovery
timeframes globally, and in particular the restrictions in
relation to travel, there is no certainty that the demand for
CTM’s services will normalise to a level existing prior to the
impact of COVID-19, or how long such a return might take.
CTM is leveraged to domestic travel and is able to operate
a high performing domestic-only business in region until
international activity returns.
multiple jurisdictions and a diverse portfolio of customers,
including a high exposure to essential travel clients,
provides the Group with greater resilience when there are
disruptions to the travel industry. The Group’s ‘capital light
model’ allows the Group to rapidly re-size the business and
reduce costs, while maintaining a high quality product
and service offering to customers. The combination of the
Group’s resilient business model and the actions taken
to respond to COVID-19, including strong cost control,
securing debt covenant waivers and preserving liquidity
have helped to mitigate the impact of COVID-19.
General economic conditions
conditions globally. A prolonged deterioration in general
economic conditions (both globally and regionally)
including a decrease in consumer and business demand,
are likely to have a material adverse impact on the Group’s
operating performance through a reduction in corporate
travel, including airline, hotel and hire car reservations and
business or trade conferences. This risk is heightened in
the current uncertain economic environment.
It is anticipated that many of the markets in which the
Group operates will have economic downturns of differing
severity and duration, which could affect the desire of
people to travel in those markets, which in turn impacts
of the Group.
There are also other changes in the macroeconomic
environment which are beyond the control of CTM
and may be exacerbated in an economic recession or
downturn. These include, but are not limited to:
currency exchange rates;
changes in employment levels and labour costs,
which will affect the cost structure of the Group;
changes in aggregate investment and economic
output; and
other changes in economic conditions which may
affect the revenue or cost of the Group.
Due to the impact of COVID-19, many of these factors are
in a state of change and may have an adverse impact
in the future.
43CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
To mitigate these impacts, the Group maintains a
resilient business model with a diverse portfolio of
clients across multiple jurisdictions and industries, which
client as recovery occurs in different timeframes across
the Group’s key regions.
Supplier risk
contractual arrangements with a number of third party
suppliers, including airlines, rail travel providers and
global distribution system providers. The Group cannot
be certain that contracts with third party suppliers will be
renewed or the terms on which they may be renewed. If
contracts are not renewed or are renewed on terms which
are less favourable than current arrangements, there is
a possibility that this would diminish the attractiveness
of the Group’s offerings to consumers, which may result
in the Group being unable to generate earnings equal to
those historically generated by those contracts.
Further, there are a variety of credit risks inherent in the
Group’s supply chains which are particularly heightened
in the current economic environment. To the extent
of the impact of COVID-19), they may seek to change the
reduce engagement with the Group or, in some cases,
may not pay their debts as and when they fall due.
Receivable balances are actively monitored on an ongoing
are taken to mitigate the Group’s exposure to bad debts.
Client risk
dependent upon client satisfaction, loyalty and the
As a result of unprecedented travel restrictions and
declining consumer and business sentiment towards
travel in general across the Group’s key markets, the
Group cannot be certain that clients will engage in any
minimum level of travel activity, that contracts with
clients will be renewed or the terms on which they may
be renewed. If contracts which account for material travel
activity are not renewed or are renewed on terms which
are less favourable than current arrangements, there is
a possibility that this would result in the Group being
unable to generate earnings equal to those historically
generated by those contracts. Further, any diminution
in client satisfaction may have an adverse impact on the
In mitigating this risk, the Group has a diverse spread
of quality clients with exposure to a wide variety of
industries. For example, many of CTM’s essential travel
have continued to travel during the COVID-19 pandemic.
Further, CTM’s proprietary client-facing technology
delivers CTM the ability to swiftly deploy software updates
to meet changing client needs and expectations.
Financing risk
The Group is exposed to risk relating to the cost and
availability of funds to support its operations, including
changes in interest rates and foreign currency exchange
rates, counterparty credit and liquidity risk, which could
CTM maintains a revolving multi-currency bank loan
facility with its relationship banks. The Group agreed a
covenant waiver with its lenders for the testing periods
through to 31 December 2021. Covenant testing for
the period ending 30 June 2022 will be based on 2H22
performance. To the extent the Group’s operational
no guarantee that it will be able to obtain further
relief from covenant testing in the future. In such
circumstances, the banks may require the loan be
repaid immediately, which may have a material adverse
Refer to note 20 'Financial risk management'.
Foreign exchange risk
The Group operates internationally and is exposed to
foreign exchange risk. The Group uses foreign exchange
spot and forward contracts to manage its net risk position.
At times, the Group also uses its multi-currency debt
facility allowing for borrowings in relevant currencies
to provide an offset to revaluation of foreign currency
assets or future foreign currency earnings. However,
notwithstanding these measures, the movement of
foreign exchange rates could still have an adverse effect
to note 20 'Financial risk management'.
Taxation risk
Changes in tax law, or changes in the way tax law is
interpreted in the various jurisdictions in which the
Group operates, may impact the future tax liabilities of
the Group. There can be no assurance that these tax laws
or their interpretation in relation to the Group will not
change, or that regulators will agree with the tax position
the Group has adopted.
The Group regularly reviews its operating business model
and strategies to take account of changes in tax law and
changes in the way tax law is interpreted, which may
impact the Group.
44 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Information Technology
The Group relies on both its outsourced technology
platforms and develops its own software internally.
Whilst all third party systems are licensed, any failure or
disruption to the supply or performance of these systems
may have an immediate and a longer term impact on
the Group’s operations, client and supplier satisfaction
and company performance, which may have an adverse
The Group manages this risk by having system
redundancy, other back-up measures, security and
monitoring programs in place. However, there can be
no assurance that the Group’s mitigation arrangements
Cybersecurity and data protection
The protection of client, employee, third party and
company data is critical to the Group’s operations. The
employee and third party information, including through
its database of clients. There is a risk of failure in the
of cyber-attacks. Any unauthorised access to the Group’s
information technology systems (including as a result
of cyberattacks, computer viruses, malicious code or
phishing attacks) could result in the unauthorised release
the Group, its employees or clients, which may lead to
penalties, litigation and compromised relationships with
clients. Further, cyber-attacks or a disruption in relation to
suppliers may impact the Group’s operations. For example,
a disruption in relation to airline operators could cause
in the Group being unable to provide certain services
during that period or providing a less attractive service,
which may have an adverse impact on the operating
regulatory environment surrounding information security
and privacy is increasingly complex and demanding. The
and third party information and the protection of that
information is critical to the Group’s operations.
The Group has monitoring programs and systems in
place to monitor and identify potential threats. It also
utilises third party expertise from technology partners
and maintains support arrangements for cyber incident
response and recovery. The Group also holds a cyber
breach insurance policy.
Competition
The Group operates in a competitive market, and the
Group’s business is subject to competition from existing
and new entrants and business models at any time.
Technological innovation is now challenging entire
business models and causing disruption to industry
structures. Technological developments have therefore
increased, and will continue to increase competition to
the Group’s businesses. Also, current competitors or new
competitors may become more effective.
If the Group does not adequately respond to competitive
forces, this may have an adverse effect on operational
competition from new entrants may result in a material
share or revenues.
The Group aims to continually improve its product and
service offering to attract and retain customers.
People and Capabilities
CTM relies on the talent and experience of its directors,
term sustainability is dependent on attracting and
retaining talented and motivated staff. As the travel
industry continues to face a challenging operating
environment, we expect to see the exit of skilled
employees from our business and the industry. In
addition to retaining people with corporate travel
expertise, we need to attract and retain employees
with expertise in areas such as cybersecurity, software
development, data and analytics. Attracting and retaining
The loss of any key personnel could cause disruption
to the conduct of CTM’s business in the short term
and may have a material adverse impact on CTM’s
timely manner or at comparable expense. The Group
regularly reviews its succession planning, training and
development programs as well as its remuneration
frameworks to mitigate and manage this risk.
Acquisitions and integration
From time to time, the Group examines new acquisition
opportunities in all of the regions in which it operates.
Any future acquisitions may cause a change in the
sources of the Group’s earnings and result in variability
of earnings over time. There is a risk that integration
of new businesses may result in the Group incurring
substantial costs, delays or other problems in
implementing its strategy for any acquired businesses,
which could negatively impact the Group’s operations,
performance of investments and the economic
conditions they operate within may result in investment
impairment should the recoverable amount of the
investment fall below its carrying value.
45CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Impairment risk
CTM assesses whether there is any indication that an
asset may be impaired on an ongoing basis. Annually,
or when an indicator of impairment exists, CTM makes
a formal estimate of the recoverable amount. When
the carrying amount of an asset exceeds its recoverable
amount the asset is considered impaired and is written
down to the recoverable amount. Adverse outcomes of
some of the risk factors listed above, and in particular
if market conditions continue to deteriorate, as well as
new developments which are not currently apparent,
could trigger an impairment and have a negative impact
'Impairment testing of goodwill'.
Litigation risk
While the Group is not currently engaged in any
material litigation or disputes, it remains exposed to
possible litigation and dispute risks, and this risk may
be heightened having regard to the current volatility
in global economic markets. A member of the Group
may be subject to litigation in the course of its business,
in each of the jurisdictions in which it operates,
including commercial, contractual or client claims,
injury claims, employee claims, indemnity claims and
regulatory disputes.
Even if the Group is ultimately successful in defending
claims against it (or in pursuing claims made by it),
and associated costs may be incurred that may not be
recoverable from other parties, which may have a
position and performance.
Any litigation, disputes or investigations that arise from
time to time are proactively managed by the Group with
reputation and ongoing business.
Political and social sustainability risk
The Group has global operations. The ability of the
Group to conduct business in the countries in which it
operates long-term, is uncertain. Regional, political or
social instability (including as a result of COVID-19) could
negatively impact the Group’s revenue streams and
multiple jurisdictions and a diverse portfolio of customers
provides the Group with greater resilience if regional,
political or social instability arises.
Signicant changes in the state of affairs
Events since the end of the nancial year
No matter or circumstance has arisen since 30 June 2021
the Group's operations, the results of those operations, or
Likely developments and expected results
of operations
As vaccines are being delivered across the globe, travel
activity is expected to recover over the coming years.
The domestic travel market is recovering faster than
international travel. The Group's exposure to domestic
travel activity is proportionately high and is able to
operate a high performing domestic-only business until
meaningful international activity returns.
The Group's global footprint, diverse client pool,
technology assets, and strong cost management has
enabled a return to positive underlying EBITDA from
primarily domestic travel activity in 2H21. This has the
Group well-positioned to grow our business organically
as travel activity returns.
Details that could give rise to likely material detriment
to the Group, for example, information that is
third party a commercial advantage, has not been
included in this report.
Environmental regulations
environmental regulations apply to its operations.
The Directors have considered climate-related risks and do
not currently deem there to be an associated material risk
to the Group's operations and the amounts recognised
monitor climate-related and other emerging risks and the
Group's sustainability report for additional information.
46 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Information on Directors
out below.
Mr Ewen Crouch AM BEc (hons.), LLB, FAICD
Independent Non-Executive Director – Chairman since
March 2019
Experience and expertise:
Ewen Crouch was a Partner at Allens from 1988 – 2013.
including four years as Chairman of Partners. His other
roles at Allens included Co-Head Mergers & Acquisitions
and Equity Capital Markets from 2004 – 2010, Executive
Managing Partner from 1993 – 1996. He was a director of
Mission Australia from 1995, including as Chairman from
2009, until retiring in November 2016.
Ewen is a Fellow of the Australian Institute of Company
Directors, a member of its Law Committee and a director
of Jawun. He served as a member of the Takeovers Panel
from 2010-2015, as a member of the Commonwealth
Remuneration Tribunal from 2015-2019 and as a director of
Sydney Symphony Orchestra from 2009-2020.
Other current directorships:
BlueScope Steel Limited (since March 2013)
Former directorships (last 3 years):
Westpac Banking Corporation (February 2013 - December
2019).
Special responsibilities:
Chair of the Board
Chair of Nomination Committee
Audit & Risk Committee member
Remuneration & Sustainability Committee member
Interests in shares:
12,482 Ordinary shares in Corporate Travel
Management Limited
Mr Jamie Pherous BCom
Executive Director, Managing Director since May 2008
Experience and expertise:
Jamie Pherous founded Corporate Travel Management
in 1994. He has built the Group from its headquarters
in Brisbane to become one of the world’s largest travel
management companies.
Prior to establishing CTM, Jamie Pherous was employed
consulting notably in Australia, Papua New Guinea and
the United Arab Emirates.
Other current directorships:
Nil
Former directorships (last 3 years):
Nil
Special responsibilities:
Managing Director
Interests in shares:
19,240,000 Ordinary shares in Corporate Travel
Management Limited
47CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Ms Laura Rufes MBA, GAICD
Executive Director since December 2015
Experience and expertise:
and, in late 2015, was appointed an Executive Director
in recognition of her leadership contribution. She has
and, in a career of more than 20 years, has led teams
across sales, account management, operations and
CTM’s business performance. She joined CTM in 2010 and
has been a key contributor to its successful growth.
Other current directorships:
Australian Federation of Travel Agents
Former directorships (last 3 years):
Nil
Special responsibilities:
Interests in shares:
50,000 Ordinary shares in Corporate Travel
Management Limited
Interests in rights:
437,500 Share appreciation rights in Corporate Travel
Management Limited
Ms Sophia (Sophie) Mitchell B.Econ, GAICD
Independent Non-Executive Director since
September 2019
Experience and expertise:
Sophie Mitchell has over 30 years of corporate advisory,
capital markets and equity research experience. She
retired from Morgans in June 2019 after over a decade as
an Executive Director in Morgans Corporate and, prior to
this, she was Morgans Head of Research.
Sophie is a Non-Executive Director of Morgans Holdings
(Australia), the Morgans Foundation Limited, and Myer
Family Investments Pty Ltd a Board member for the
Australia Council for the Arts, Chairman of Australian
Super’s Queensland Advisory Council and was a member
of the Australian Government Takeovers Panel between
2009 and 2018.
Other current directorships:
Flagship Investments Limited (since June 2008)
Apollo Tourism and Leisure Ltd (since September 2016)
Former directorships (last 3 years):
Silver Chef Limited (September 2011 - December 2019)
Special responsibilities:
Chair Remuneration & Sustainability Committee
Audit & Risk Committee member
Nomination Committee member
Interests in shares:
27,612 Ordinary shares in Corporate Travel
Management Limited
48 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Mr Jon Brett BAcc, MCom, CA(SA), Dip Datametrics
Independent Non-Executive Director since
January 2020
Experience and expertise:
Jon Brett was formerly an executive director of Investec
Wentworth Private Equity Limited, and an executive of
Investec Bank (Australia) Limited. He was also the CEO
of Techway Limited which pioneered internet banking
in Australia. Jon brings extensive strategic, board and
management experience to CTM, particularly in the areas
of nance and corporate advisory.
Jon is currently Executive Chairman of Stridecorp Equity
Partners, an AFSL licensed fund manager specialising in
private equity. His former directorships include Godfreys
Group Limited, The Pas Group Limited, deputy president
of the NRMA and Vocus Group Limited since its listing
on the ASX.
Other current directorships:
Mobilicom Limited (since September 2018)
Former directorships (last 3 years):
Indoor Skydive Australia Limited (September 2018 –
July 2019)
Vocus Group Limited (June 2010 – August 2018)
Special responsibilities:
Chair Audit & Risk Committee
Remuneration & Sustainability Committee member
Nomination Committee member
Interests in shares:
1,249 Ordinary shares in Corporate Travel
Management Limited
Company secretary
Anne Tucker
Anne Tucker was appointed as a Company Secretary
on 2 September 2019. Anne holds Bachelors of Law and
Commerce, Graduate Diplomas in Legal Practice and
Applied Corporate Governance, and is an Associate of the
Governance Institute of Australia.
Meetings of Directors
The number of meetings of CTM's Board of Directors ('the
Board') held during the year ended 30 June 2021, and the
number of meetings attended by each Director were:
Board
A
Board
B
Mr Ewen Crouch AM
12 12
Ms Sophie Mitchell
12 12
Mr Jon Brett
12 12
Mr Jamie Pherous
12 12
Ms Laura Ruffles
11 12
49CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Audit & Risk
Committee
A
Audit & Risk
Committee
B
Remuneration
& Sustainability
Committee
A
Remuneration
& Sustainability
Committee
B
Nomination
Committee
A
Nomination
Committee
B
Mr Ewen Crouch AM
4 4 4 4 3 3
Ms Sophie Mitchell
4 4 4 4 3 3
Mr Jon Brett
4 4 4 4 3 3
Mr Jamie Pherous
NM NM NM NM NM NM
Ms Laura Ruffles
NM NM NM NM NM NM
A = Number of meetings attended
B
= Number of meetings held during the time the Director held office or was a member of the Committee
NM = Not a member of the relevant Committee
Corporate Governance
The Board of CTM recognises the importance of good corporate governance practices which assist in ensuring the
accountability of the Board and management of the Group. The Group believes that these practices are fundamental to
the long-term performance and sustainability of the Group, the delivery of strategic objectives and contributing to the
preservation of shareholder value.
Information relating to the Group’s corporate governance practices and its Corporate Governance Statement can be found
in the Corporate Governance section on the Group’s website at https://investor.travelctm.com.au/corporate-governance
50
CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Introduction
This report sets out the remuneration arrangements of the Company for the year ended 30 June 2021
and is prepared in accordance with section 300A of the Corporations Act 2001. The information has been
audited as required by section 308(3C) of the Corporations Act 2001.
The report is structured as follows:
Letter from the Chair of the Remuneration & Sustainability Committee 52
Remuneration Highlights 54
Persons covered by this report 55
Remuneration governance framework 56
Executive KMP remuneration 57
Contractual arrangements for Executive KMP 64
Non-executive Director Remuneration 64
Statutory KMP Remuneration 65
Other information 67
Remuneration
Report
51CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Letter from the Chair of the Remuneration & Sustainability Committee
Dear Shareholders,
I am pleased to present you with CTM’s Remuneration Report for the year ended 30 June 2021.
FY21 was another challenging year for the travel industry as a whole and CTM’s approach to remuneration and
sustainability continued to focus on those matters which we consider to be material to CTM’s long-term sustainability and
to creating value for our stakeholders. Since expanding the Committee's role to include oversight of sustainability matters,
we have reviewed our sustainability strategy and associated reporting to provide further information on the material areas
that we believe are critical to CTM’s sustainability over the longer term. Further information regarding CTM’s approach to
sustainability can be found in the Sustainability Report commencing on page 20.
FY21 Outcomes
In FY21, we implemented a range of remuneration related measures in response to COVID-19. Many of these measures,
hours and pay, were introduced in FY20 and continued into FY21.
We also implemented measures to support our employees with a variety of initiatives promoting health and mental
well as support provided through our employee assistance program.
Pleasingly, and consistent with increasing travel activity in Australia, New Zealand, North America and Europe over the
second half of FY21, we have welcomed back some former CTM employees and on-boarded new employees. We also
thank our CTM alumni for all they have contributed to our business and look forward to continuing to welcome back
many of our alumni to the CTM business as travel activity recovers. Unfortunately in regions such as Australia, sudden
regional lockdowns and border closures result in short term impacts on revenue and activity, and we are thankful for the
through the pandemic. The support, understanding and loyalty of CTM’s staff is a testament to the culture at CTM.
For FY21, we made some temporary adjustments to both our short term and equity incentive programs in an attempt to
balance the impact of COVID-19 on earnings, preserve incentive remuneration arrangements aligned with shareholders,
while maintaining our ability to attract, retain and motivate employees during a period of heightened uncertainty.
Given the short term earnings uncertainty driven by border closures and government mandated quarantine
requirements, the Committee decided to make some adjustments to the FY21 STI program. The STI opportunity for all
employees was reduced by 50% and KPI targets were directly focused on cost containment, cash management and
client retention. We also split the FY21 STI program into two opportunities across the full year, with positive underlying
earnings gates for both opportunities. This differed from the usual earnings gate that underlying earnings exceed the
client contract wins and substantial revenue to our UK business. No short term incentives were awarded to key
management personnel given their participation in the FY21 equity incentive program.
offered share appreciation rights (SARs), where two-thirds of the rights granted were subject to EPS growth and
conduct hurdles measured across a two year performance period and one-third were subject to conduct hurdles,
including a 12 month service condition, with recipients not able to dispose of shares awarded upon vesting for a further
12 month period. The SARs tranche subject to the 12 month service condition have now vested and are able to be
exercised by participants.
Talent retention and motivation are critical for CTM’s business performance and to create wealth for shareholders. In our
experience, employees in the travel industry with transferable skills who are experiencing uncertain future prospects have
been and will continue to be targeted by other industries during this period of uncertainty. The temporary adjustments to
directly at the retention of our leaders and to incentivise actions and behaviours consistent with the immediate priorities of
the Group which the Committee judged would drive future shareholder returns. The outcome has been strong cost control,
cash management and client retention, the successful acquisition of Travel & Transport and Tramada and delivery of key
integration objectives in accordance with our integration plan, and an excellent retention rate among our senior leaders.
Remuneration Report Continued
52 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Equity incentives in the form of SARs were also awarded to key Travel & Transport senior leaders to support retention and
integration delivery. Vesting of these SARs is conditional on continued service through until 30 June 2022, in line with our
integration road map. In addition, a cash incentive was offered to seven Travel & Transport senior leaders considered critical
to the delivery of the integration plan. Moving forward, eligible CTM North American senior leaders will participate in SARs
offers made to other Group senior leaders.
FY22 Approach
Our overarching remuneration strategy remains focused on driving performance and providing competitive total rewards
that attract, retain and motivate the high quality employees required to deliver on CTM’s longer term growth aspirations
during a period of ongoing uncertainty. Retaining, motivating and having the ability to attract staff is particularly
important to combat employee concerns about job security and lower job satisfaction, and to limit staff with transferable
skills moving to sectors less affected by the pandemic. Equally important is aligning our talented people with shareholders
by incentivising our people to deliver long-term sustainable growth in shareholder value and ensuring our people’s
conduct meets CTM’s values and expectations.
As the business continues to recover, the Group’s ability to attract, retain and motivate staff remains a high priority and
we recognise that each of our regions will recover at different cadences. During this recovery phase, we are mindful of the
importance of balancing all stakeholders’ interests.
a return to full pay and working hours for all of our people
wherever possible, the continued return of CTM alumni in line with travel activity
a short term incentive pool based on the Group achieving positive underlying EBITDA for FY22 and achievement
containment, employee engagement, client satisfaction or major project/integration execution. This short tem
incentive will be available to a wider group of CTM employees than in previous years
an equity incentive plan comprised of SARs set at a strike price of $21.19 (5 day VWAP to 30 June 2021) capable of
vesting over two and three year performance periods, with vesting conditional on achieving conduct and service
conditions and EPS growth (100% vesting at 20% EPS growth over the performance period).
We expect that when the business recovers, the remuneration structure will return broadly to the pre-COVID-19
structure. The Committee believes this structure is simple and clear and has served CTM’s shareholders and employees
well for many years.
On behalf of the Committee, I thank you for your ongoing support of CTM.
Yours Sincerely,
Sophie Mitchell
Remuneration & Sustainability Committee Chair
18 August 2021
Remuneration Report Continued
53CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Remuneration Highlights
COVID-19
Throughout FY21 we have continued to support our
business continuity as well as offering mental health
support through our employee assistance programs and
local initiatives in each of our regions.
Many of the plans which were actioned in FY20 to manage
costs against the reduced corporate travel activity
experienced as a result of COVID-19 continued in FY21.
As travel activity returns, we have recommenced hiring in
some regions , and where possible, have begun returning
our people to full pay and working hours. In those regions
where activity remains low relative to pre-COVID 19 levels or
where sudden regional lockdowns and border closures result
in short term impacts on revenue and activity, our people
remain on reduced pay and working hours.
In the second half of FY21, further redundancies were
actioned in the Asia region as travel activity remains very low.
Group remuneration
(FAR) for employees across the Group (FY20: average 3%).
There was no increase in FAR for Executive KMP, noting
that Executive KMP returned to full pay from 1 August 2020.
Managing Director remuneration
Total FY21 remuneration for the Managing Director and
CEO (Managing Director) was $492,904 (FY20: $436,010).
No short term or long-term incentive was awarded to the
Managing Director in FY21.
As part of the Company’s cost containment measures to
mitigate the impacts of COVID-19, the Managing Director’s
part of FY20 and FY21, returning to 100% from 1 August 2020.
Short term performance incentives
No short term incentives were awarded to KMPs.
In FY21 we awarded $220,000 in short term incentives
relating to exceptional outcomes (FY20: nil). These
incentives were awarded to employees who contributed to
and substantial revenue contribution in our UK business.
FY19 Long-term performance incentives
Following the end of the three year performance period
ended 30 June 2021, share appreciation rights (SARs)
awarded to employees in FY19 were tested. Vesting of
these SARs was conditional on achieving:
conduct and service conditions – continued
employment and behaviour in line with our values
performance conditions – EPS growth, with target
performance being set at 10% EPS growth.
With the impact of COVID-19 on earnings, the EPS
performance condition was not met, resulting in all of the
FY19 SARs being forfeited.
FY21 retention and performance equity incentives
In FY21, we made some temporary adjustments to our
equity incentive program to balance the impact of
COVID-19 on earnings, preserve incentive remuneration
arrangements aligned with shareholders, while
maintaining our ability to attract, retain and motivate staff
during a period of heightened uncertainty.
The FY21 equity offer was comprised of two tranches of SARs:
approximately one-third of SARs were granted with
vesting conditional on achieving conduct and service
conditions over a 12 month period, with a further 12
month disposal restriction (FY21 Retention SARs); and
approximately two-thirds of SARs were granted with
vesting conditional on achieving conduct and service
and EPS growth over a two year period ending 30 June
2022 (FY21 Performance SARs).
The temporary adjustments to our FY21 equity incentive
program were aimed directly at the retention of our
leaders and to incentivise actions and behaviours
consistent with the immediate priorities of the Group
which the Committee judged would drive future
shareholder returns. The outcome has been strong cost
control, cash management and client retention, the
successful acquisition of Travel & Transport and Tramada
and delivery of key integration objectives in accordance
with our integration plan, and an excellent retention rate
among our senior leaders.
Having achieved share price growth over a strike price of
$9.89 (5 day VWAP to 30 June 2020), the FY21 Retention
a total of 431,786 CTM shares able to be exercised from
809,750 SARs awarded to 48 participants.
Acquisition of Travel & Transport
With the acquisition of Travel & Transport (which
completed in October 2020) and to support retention and
integration delivery, equity incentives in the form of SARs
were awarded to Travel & Transport senior leaders. Vesting
of these SARs is conditional on achieving conduct and
service conditions ending on 30 June 2022. These SARs
were set at a strike price of $12.35.
Cash retention arrangements were also established with
seven Travel & Transport executives considered critical
to the integration program. Further details about these
arrangements can be found on page 56 of this report.
Non-executive Director fees
There were no increases to Non-executive Director fees in
FY21 (FY20: 1.7% increase to Non-executive Director fees
and a 1% increase to the Chairman’s fees).
As part of the Company’s cost containment measures to
mitigate the impacts of COVID-19, Non-executive Director
fees were reduced by an equivalent 33% for part of FY20
and FY21, returning to 100% from 1 August 2020.
Remuneration Report Continued
54 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
FY22
The FY22 remuneration plan includes:
a short term incentive opportunity where the Group achieves positive underlying EBITDA for FY22, with each
regional imperatives; and
an equity incentive plan comprised of SARs set at a strike price of $21.19 (5 day VWAP to 30 June 2021), capable of
vesting over two and three year performance periods, with vesting conditional on achieving conduct and service
conditions and EPS growth (100% vesting at 20% EPS growth over the performance period).
We expect that when the business recovers, the remuneration structure will return broadly to the pre-COVID-19 structure.
Persons covered by this report
Key management personnel (KMP) include Non-executive Directors, Executive Directors and those senior executives with
authority and responsibility for the planning, controlling and directing of the activities of the Company and the Group,
which includes those executives who lead business units.
For the purposes of this report, Executive KMP means the Executive Directors (Managing Director and Global COO), the
Global CFO, the CEO - North America, CEO – UK/Europe, CEO – Asia and the CEO – Australia and New Zealand.
Details of the KMP are provided in the table below.
Name Position
Non-executive Directors
Ewen Crouch AM Chairman, Non-executive Director
Jon Brett Non-executive Director
Sophie Mitchell Non-executive Director
Executive Directors
Jamie Pherous Managing Director
Global COO
Other Key Management
Personnel
Kevin O’Malley CEO – North America (appointed as a KMP 1 November 2020)
Debbie Carling CEO – UK/Europe
Larry Lo CEO – Asia
Greg McCarthy CEO – Australia and New Zealand
Cale Bennett Global CFO (appointed as a KMP 1 March 2021)
KMP who ceased to
be KMP in FY21
Neale O’Connell
1
Global CFO (ceased as KMP 26 February 2021)
Maureen Brady
2
CEO – North America (ceased as KMP 30 October 2020)
1
Neale O’Connell retired as Global CFO on 26 February 2021. Mr O’Connell’s services were retained after his retirement under a consultancy agreement which
ended on 30 June 2021.
2
Maureen Brady remains employed by CTM. Following the acquisition of Travel & Transport and appointment of Kevin O’Malley as CEO – North America, Maureen
Brady was appointed COO – North America.
Remuneration Report Continued
55CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Remuneration governance framework
Remuneration and Sustainability Committee
The Remuneration and Sustainability Committee
(Committee) consists of all of the Non-executive Directors,
with one performing the role of Chair. The Managing
Director and Global COO are invited to attend but are not
present when their remuneration is discussed.
The Committee has an advisory role and assists the
Board in the following areas:
people and remuneration strategy and policies;
setting executive remuneration and incentives for
Executive KMP;
talent development and succession planning;
Non-executive Director remuneration; and
sustainability issues relevant to the Group.
Under the terms of the Remuneration and Sustainability
Committee Charter, the majority of Committee
members must be independent directors and the Chair
of the Committee must be an independent director.
All members of the Remuneration and Sustainability
Committee are independent non-executive directors.
Details about members of the Committee and their
backgrounds are included in the Directors’ Report which
can be found on pages 47 to 49.
To ensure the Committee is fully informed when making
remuneration decisions, the Committee may seek external
remuneration advice. During the reporting period, the
Committee did not engage any consultants to provide
recommendations in relation to remuneration.
COVID-19
In light of the reduced travel activity experienced from the
COVID-19 pandemic, the various plans actioned by CTM
during FY20 to manage its cost base while balancing the
need to retain a motivated, engaged and adequately sized
workforce, remained in place in FY21. Consistent with our
clear purpose to deliver an enhanced value proposition to
corporate travellers, we have been focused on retaining
a skilled and knowledgeable team to support our clients
and our business as travel activity returns.
We have welcomed back some of our former CTM
employees in-line with increasing travel activity in
Australia, New Zealand, North America and Europe and
have begun returning our people to full pay and working
hours. However, in those regions where activity remains
low relative to pre-COVID 19 levels, or where sudden
regional lockdowns and border closures result in short
term impacts on revenue and activity, our people remain
on reduced pay and working hours. For KMP, all Executive
KMP and non-executive Directors were returned to full pay
from 1 August 2020.
Acquisition of Travel & Transport
As part of the acquisition of Travel & Transport, the
Committee considered the need to put retention
arrangements in place for certain Travel & Transport
employees to reduce the risk of loss of employees who
occupy roles that are key to the delivery of the integration
plan. To support retention and integration delivery,
equity incentives in the form of SARs were awarded to 23
Travel & Transport senior leaders. Vesting of these SARs is
conditional on achieving conduct and service conditions
ending on 30 June 2022. These SARs were set at a strike
price of $12.35.
In addition, a maximum total retention pool of USD 2.3
million was approved by the Board and, during FY21, an
allocation was made to cover seven employees considered
critical to the delivery of the integration plan
For these seven senior executives, the retention
annual remuneration at the time of the acquisition of
Travel & Transport. The retention arrangements are
payable on 30 October 2021 for these senior executives.
The Board believes that these arrangements are fair
and reasonable and that it was in shareholders’ best
interests that the services of these senior executives were
retained to lead the Group through the Travel & Transport
integration program.
Remuneration Report Continued
56 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Executive KMP remuneration
Remuneration Framework
The objective of the Group’s remuneration framework,
summarised below, is to:
attract and retain high calibre team members;
incentivise and reward team members for the
achievement of strategic objectives designed to
deliver sustained growth in shareholder wealth,
ensuring reward for performance is competitive
and appropriate for the results delivered; and
align remuneration with shareholder interests.
Key elements of remuneration
The Group’s remuneration framework typically has three
components:
Fixed annual remuneration (FAR);
Short term performance incentives (STI); and
Equity incentives (LTI).
CTM’s remuneration framework provides for a mix of short
and long-term incentives. As team members gain seniority
within the Group, the balance of their remuneration mix
between FAR, STI and LTI shifts to a higher proportion of
‘at risk’ rewards, commensurate to each individual’s role
and responsibilities.
The proportion of short and long-term incentives
awards are subject to adherence with CTM’s values
and behavioural standards – behaviour which does not
meet expectations is actively and consistently managed,
through the application of formal consequences such
as formal warnings, reductions to performance-based
remuneration, or termination of employment.
Fixed Annual Remuneration
Fixed annual remuneration (FAR) comprises base pay,
superannuation and pensions. Team members are
offered a competitive FAR that targets the desired skills
and experience for our roles. FAR is reviewed annually, to
ensure that it remains competitive with the market. Team
member FAR is also reviewed upon promotion. There
are no guaranteed pay increases in any senior executive
contracts of employment and in FY21 there were no
Variable Remuneration - Short term
performance incentives (STI)
Participation in the Group’s short term incentive
scheme is broad, with team members across all
regions eligible to participate. An individual’s target STI
opportunity is set depending on the accountabilities
and impact of the role on the organisation or business
unit performance. Short term incentives are paid in cash
around 30 September each year.
The scheme is designed to reward and recognise
outstanding employee performance and execution
of CTM’s business plans, provided the Group can also
demonstrate it has created value for shareholders.
Each year, the Remuneration and Sustainability
Committee considers the appropriate targets and key
performance indicators (KPIs), including setting any
maximum payment potential under the STI plan and
minimum levels of performance required to trigger
payment of short term incentives. STI performance targets
are underpinned by the Group’s strategic priorities and are
aligned with CTM’s values and risk appetite. All targets and
Ordinarily, the short term incentive pool is based on the
following key elements:
1.
2. each individual’s performance.
The Board retains the discretion to adjust short
Remuneration Report Continued
57CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
1. Financial Performance
incentive pool would become available. The criteria for FY21 required positive underlying EBITDA in each half, adjusted for
and size as unusual or not in the ordinary course of business, such as merger and acquisition activity.
If the global and regional underlying EBITDA results exceed expectations, the full STI pool will be available for distribution.
Conversely, if results are below expectations, only a fraction of the pool, or possibly none of the short term incentive pool
created for shareholders and when earnings are consistent with the Group’s approved targets.
2. Individual Performance
Each individual’s incentive opportunity is determined by reference to the individual’s own KPIs. KPI targets for Executive
management, client retention, people and leadership.
Individual performance impacts the amount of incentive payment for any individual. Executive KMP performance reviews
are conducted by the Managing Director and provided to the Remuneration and Sustainability Committee and Board
annually. The Managing Director’s performance review is conducted by the Chairman and provided to the Remuneration
and Sustainability Committee and Board annually.
Executive KMP Title / Region
Financial KPIs
EBITDA
Cost containment
Cash management
Client retention
People and
leadership
Jamie Pherous MD / Global 70% 30%
COO / Global 70% 30%
Cale Bennett
1
CFO / Global 80% 20%
Kevin O’Malley
1
CEO / North America 70% 30%
Larry Lo CEO / Asia 70% 30%
Debbie Carling CEO / UK/Europe 70% 30%
Greg McCarthy CEO / Australia & New Zealand 70% 30%
1
Executives who became KMPs during the year. Cale Bennett commenced as a KMP on 1 March 2021. Kevin O’Malley commenced as a KMP on 1 November 2020.
Special projects / circumstances incentive
The Board has the discretion to consider special achievements when determining the amount payable in incentives.
longer term value of the Group.
this nature will generally be in the form of cash.
In FY21 we awarded $220,000 in short term incentives to employees whose contribution to special projects delivered
Remuneration Report Continued
58 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
FY21 Reward Outcomes under STI
FY21 with government mandated shutdowns, border closures, quarantine arrangements and travel restrictions remaining
in place in various forms.
In light of the uncertain environment for our employees and the travel industry more generally, minor adjustments were
targets for both periods and individual KPIs focused on global EBITDA targets, cost containment, cash management, client
retention and people and leadership. For all employees, including Executive KMP, their potential STI opportunity for FY21
was set at a maximum of 50% of their FY20 maximum opportunity (25% of their FY20 maximum opportunity for each half).
Following the assessment of Executive KMP against their KPIs, no short term incentives were awarded to KMPs as
summarised in the table below:
Name
Maximum
STI Potential
(FY21)
1
FY21
Maximum STI
Potential (FY20)
1
FY20
Awarded % Forfeited % Awarded % Forfeited %
Jamie Pherous $125,000 0% 100% $270,000 0% 100%
$550,000 0% 100% $1,100,000 0% 100%
Cale Bennett
2
N/A N/A N/A N/A N/A N/A
Kevin O’Malley
2
$250,000 0% 100% N/A N/A N/A
Larry Lo $129,402 0% 100% $286,352 0% 100%
Debbie Carling $112,702 0% 100% $234,522 0% 100%
Greg McCarthy $25,000 0% 100% $50,000 0% 100%
Neale O’Connell
3
$115,000 0% 100% $230,000 0% 100%
Maureen Brady
3
$66,916 0% 100% N/A N/A N/A
1
Maximum STI potential for Kevin O’Malley, Larry Lo, Debbie Carling and Maureen Brady are determined in local currency and converted at average exchange rates.
2
Executives who became KMPs during the year. Cale Bennett commenced as a KMP on 1 March 2021. Kevin O’Malley commenced as a KMP on 1 November 2020.
3
KMPs who ceased to be a KMP during the year. Neale O’Connell ceased to be a KMP on 26 February 2021 following his retirement as Global CFO. Mr O’Connell’s
services were retained after his retirement under a consultancy agreement which ended on 30 June 2021. Maureen Brady ceased to be a KMP on 30 October
2020 and remains employed by CTM as COO – North America.
Remuneration Report Continued
59CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
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Continued
Variable Remuneration – equity based incentives
Senior leaders who have a greater potential impact on
share price and long-term value creation participate in
CTM’s equity based incentive program. CTM’s equity
based incentive scheme is designed to:
(a) assist in the reward, retention and motivation of
eligible employees;
(b) link the reward of eligible employees to shareholder
value creation; and
(c) align the interests of eligible employees with
shareholders by providing an opportunity for eligible
employees to receive an equity interest in the Group.
Grants of Share Appreciation Rights (SARs) are ordinarily
long-term performance. A SAR is a right to receive an
payment, or a combination of both (at the Board’s sole
discretion), subject to the achievement of performance
conditions which can include service conditions, EPS
growth and conduct expectations.
If the performance conditions are achieved, the number of
shares awarded is calculated by reference to an increase in
the CTM share price from a strike price set at the volume
weighted average price (VWAP) of the 5 trading days prior
to 1 July immediately preceding the grant of SARs against
the 5 day VWAP immediately preceding the time that the
The use of a 5 day VWAP to set both the strike price and
the subsequent share price at the time of vesting, provides
equity based remuneration. Awards are of no value to
participants if the subsequent share price at the time of
vesting is below the strike price, aligning the interests of
participants with shareholders.
Given the potential for volatility of CTM’s share price in
the period leading into full year results in mid-August
each year, in FY21 we changed the basis of the share
price calculation to determine the equity allocation
for FY21. We replaced the 30 day VWAP for the period
immediately preceding the release of CTM’s full year
results, with a 5 day VWAP to and including 30 June,
share price at the commencement of the performance
period and would be compared against the 5 day VWAP
to and including 30 June immediately preceding the end
of the relevant performance period.
Participation
In FY21, 74 senior employees (including employees
from Travel & Transport) were invited by the Board to
participate in the equity incentive scheme (FY20: 51 senior
employees). All Executive KMP, other than the Managing
Director, participated in the FY21 equity incentive scheme.
Performance hurdles and performance period
The Board resolved to make some temporary adjustments
to the vesting conditions for the FY21 equity incentive
grants to balance the impact of COVID-19 on earnings,
preserve the alignment of incentive remuneration
arrangements with shareholders, while maintaining our
ability to attract, retain and motivate staff during a period
of heightened uncertainty.
Talent retention and motivation are critical for CTM’s
business performance and to create wealth for
shareholders. In our experience, employees in the travel
industry with transferable skills who are experiencing
uncertain future prospects have been and will continue
to be targeted by other industries during this period of
uncertainty. The temporary adjustments to our FY21 equity
these particular challenges and were designed to retain
our key staff during this period of heightened uncertainty.
The FY21 equity offer was comprised of the following
tranches of SARs:
FY21 Retention SARs were granted with vesting
conditional on achieving service and conduct
conditions (including a 12 month time based service
condition), with a further 12 month disposal restriction
FY21 Performance SARs were granted with vesting
conditional on achieving service and conduct
conditions and EPS growth over a two year period
ending 30 June 2022.
FY21 SARS were granted to Cale Bennett following
his appointment to the role of Global CFO with
vesting conditional on achieving service and conduct
conditions and EPS growth over a three year period
ending 30 June 2024.
Remuneration Report Continued
60 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
The FY21 Performance SARs, which are subject to EPS growth as well as achieving service conditions, will vest on a scaled
basis as follows:
Minimum EPS growth from 1 July 2020 – 30 June 2022
Portion of SARs that become
performance qualied
80% achievement of target growth rate (i.e. 16.0% EPS growth) 50% of SARs
90% achievement of target growth rate (i.e. 18.0% EPS growth) 75% of SARs
100% achievement of target growth rate (i.e. 20.0% EPS growth) 100% of SARs
basis where EPS growth over the relevant performance
period falls between 16-20% EPS growth.
senior Travel & Transport leaders following the acquisition of
Travel & Transport (which completed in October 2020) with
the key objective of supporting retention and integration
delivery. Vesting of these SARs is conditional on achieving
service and conduct conditions, including a time based
service condition ending 30 June 2022.
While temporary adjustments were made in FY21
to performance periods and vesting conditions,
the overarching philosophy for equity incentive
remuneration remains unchanged: to reward, retain and
motivate senior leaders; link the reward to shareholder
value creation to align senior leaders with shareholders;
provide an opportunity for eligible employees to build
an equity interest in CTM; and support our employee
conduct expectations.
The Board may exercise its discretion with respect to
adjustments to thresholds and targets at the time of
testing. The Group will provide a clear explanation if any
adjustments are made to thresholds and targets. The
Board retains the discretion to adjust equity incentives
(including vesting conditions, performance hurdles and
the forfeiture of unvested SARs), in light of unexpected
or unintended circumstances, or where an individual
has engaged in conduct which is contrary to CTM’s
values. For example, behaviour which does not meet
expectations is actively and consistently managed,
through the application of formal consequences such
as formal warnings, reductions to performance-based
remuneration, or termination of employment.
Cessation of employment, change of
control and clawback
All unvested SARs lapse immediately upon cessation of
employment with the Group. However, the Board has
discretion in special circumstances to determine that
SARs be retained and the terms applicable following
cessation of employment. Special circumstances
include events such as retirement, redundancy, death
and permanent disability. If a Change of Control Event
occurs, or the Board determines in its absolute discretion
that a Change of Control Event may occur, the Board
has absolute discretion to determine the appropriate
treatment regarding any awards.
In addition to other formal consequences, including
formal warnings or termination of employment, unvested
SARs may be clawed back where there has been a
which the award was assessed and/or the participant’s
actions have been found to be fraudulent, dishonest, in
breach of his or her duties, contrary to CTM’s values and
behavioural standards or would bring CTM into disrepute.
Dividend entitlements
Recipients of SARs are not entitled to dividends until
shares are allocated (based on vesting and meeting the
relevant performance hurdles, employment condition and
conduct expectations and being exercised by recipients).
Dilution
Shares issued under the Group’s Omnibus Incentive Plan
are subject to a cap of 5% of equity. This is inclusive of
shares that may be issued in respect of each outstanding
offer of shares, options or rights if accepted or exercised
under other equity plans.
Hedging
Executive KMP are not permitted to hedge equity awards.
Remuneration Report Continued
61CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
FY21 Reward Outcomes under equity incentive plan
FY21 SARs
In FY21, a total of 3,504,250 SARs were awarded to 74
participants (FY20: 1,678,000 to 51 participants) in
three tranches:
809,750 SARs were granted with vesting conditional
on achieving service and conduct condition conditions
(including a 12 month time based service), with a further
12 month disposal restriction (FY21 Retention SARs)
1,664,500 SARs were granted with vesting conditional
on achieving service and conduct conditions and
EPS growth over a 2 year period ending 30 June 2022
(FY21 Performance SARs)
930,000 SARs were granted with vesting conditional
on achieving service and conduct conditions ending
on 30 June 2022 (FY21 T&T Retention SARs)
100,000 SARs were granted with vesting conditional
on achieving service and conduct conditions and
EPS growth over a 3 year period ending 30 June
2024 (FY21 CFO SARs)
Having achieved share price growth over a strike price of
$9.89 (5 day VWAP to 30 June 2020), the FY21 Retention
of 431,786 CTM shares able to be exercised from 809,750
SARs awarded to 48 participants.
FY19 SARs
The three year performance period for the FY19 SARs
ended on 30 June 2021. Vesting was conditional on
the Group achieving earnings per share (EPS) growth
per annum over the three year testing period, with
target performance being set at 10% EPS growth and
participants continuing to be employed by the Group at
the end of the performance period.
were tested. As the EPS growth condition was not met,
100% of the FY19 SARs failed to vest. Had the EPS hurdle
been met, this tranche of SARs would have been valueless
to the holders given the vesting share price was below the
$29.00 strike price.
Correlation between variable remuneration and nancial results
In considering the Group’s performance in the context of appropriate remuneration levels and structures, the
and the delivery of return on investment to shareholders. Over the past two years, COVID-19 has created substantial
volatility to these measures. This is highlighted in the table below which outlines the performance of the Group and
FY 2021 FY 2020 FY 2019 FY 2018 FY 2017
(55,351) (8,185) 86,235 76,712 54,556
Basic earnings per share (cents) (43.0) (7.5) 79.6 72.4 53.5
Dividends paid ($’000) - 23,953 42,263 34,964 27,554
Dividend payout ratio (%)
1
N/A N/A 49.0 45.6 50.5
Increase/(decrease) in share price (%) 111.5 (56.9) (17.6) 19.0 63.9
Total Executive KMP STI
as percentage of net prot/(loss) (%)
0.0 0.0 1.6 1.9 2.2
1
Remuneration Report Continued
62 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
The following table sets out details of the SARs granted to persons in their capacity as Executive KMP during FY21 under
the 2021 allocation, as well as details of SARs granted under prior awards that have not yet vested as at 30 June 2021.
The three year performance period for SARs granted under the FY19 allocation ended on 30 June 2021 and were tested
following the end of FY21. As the EPS performance and share price growth conditions were not met, the FY19 tranche did
not vest and all FY19 SARs were forfeited.
The 12 month service period for the FY21 Retention SARs ended on 30 June 2021 and, having achieved share price growth
over a strike price of $9.89 (5 day VWAP to and including 30 June 2020), the FY21 Retention SARs vested following the end
Name Year of grant
Year in
which
rights
may vest
Exercise
Price
No. of
rights
granted
Value per
right at
grant date
No. of
rights
vested
during
the year
Vested
%
Forfeited
%
Max value yet
to vest
$
2021
Performance
2023 N/A 125,000 $7.18 - - - 896,975
2021
Retention
3
2022 N/A 62,500 $7.21 - - - 450,375
2020 2023 N/A 100,000 $1.67 - - - 167,230
2019 2022 N/A 150,000 $4.80 - - - 720,690
2018 2021 N/A 150,000 $2.49 - - - -
Cale Bennett
1
2021 2025 N/A 100,000 $6.00 - - - 599,920
Larry Lo
2021
Performance
2023 N/A 75,000 $2.67 - - - 200,108
2021
Retention
3
2022 N/A 37,500 $2.29 - - - 86,059
2020 2023 N/A 75,000 $1.67 - - - 125,423
2019 2022 N/A 75,000 $4.80 - - - 360,345
2018 2021 N/A 75,000 $2.49 - - - -
Debbie Carling
2021
Performance
2023 N/A 75,000 $2.67 - - - 200,108
2021
Retention
3
2022 N/A 37,500 $2.29 - - - 86,059
2020 2023 N/A 75,000 $1.67 - - - 125,423
2019 2022 N/A 75,000 $4.80 - - - 360,345
2018 2021 N/A 75,000 $2.49 - - - -
Greg McCarthy
2021
Performance
2023 N/A 75,000 $2.67 - - - 200,108
2021
Retention
3
2022 N/A 37,500 $2.29 - - - 86,059
2020 2023 N/A 75,000 $1.67 - - - 125,423
2019 2022 N/A 100,000 $4.80 - - - 480,460
Kevin O’Malley
1
2021 T&T
Retention
2023 N/A 187,500 $3.50 - - - 656,063
Neale
O’Connell
2
2021
Performance
2023 N/A 100,000 $2.67 - - 50% 133,405
2021
Retention
3
2022 N/A 50,000 $2.29 - - - 114,745
2020 2023 N/A 100,000 $1.67 - - 50% 83,615
Maureen
Brady
2
2021
Performance
2023 N/A 75,000 $2.67 - - - 200,108
2021
Retention
3
2022 N/A 37,500 $2.29 - - - 86,059
2020 2023 N/A 50,000 $1.67 - - - 83,615
1
Executives who became KMP during the year. Cale Bennett commenced as a KMP on 1 March 2021. Kevin O’Malley commenced as a KMP on 1 November 2020.
2
Executives who ceased as KMP during the year. Neale O’Connell ceased to be a KMP on 26 February 2021 after retiring as Global CFO. Maureen Brady ceased to
be a KMP on 30 October 2020 but remains employed by CTM as COO – North America.
3
FY21 Retention SARs vested on 1 July 2021.
Remuneration Report Continued
63CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Contractual arrangements for Executive KMP
Each Executive KMP, including the Managing Director, has a formal contract, known as a service agreement.
Executive KMP Contract duration
Notice period
by KMP
Notice period
by Group Termination payment
Jamie Pherous 6 months 6 months
Combination of notice and payment
in lieu totaling no less than 6 months
24 weeks 24 weeks
Combination of notice and payment
in lieu totaling no less than 24 weeks
Cale Bennett
1
12 weeks 12 weeks
Combination of notice and payment
in lieu totaling no less than 12 weeks
Kevin O’Malley
1
30 June 2023 3 months Nil
Combination of notice and payment
in lieu totaling no less than 12 months
Larry Lo 6 months 6 months
Combination of notice and payment
in lieu totaling no less than 6 months
Debbie Carling 3 months 3 months
Combination of notice and payment
in lieu totaling no less than 3 months
Greg McCarthy 12 weeks 12 weeks
Combination of notice and payment
in lieu totaling no less than 12 weeks
Termination payments are assessed on a case-by-case basis and are capped at law. As is the case for all employees, the
employment of Executive KMP may be terminated immediately in the case of serious misconduct.
Non-executive Director Remuneration
Non-executive Directors receive a base fee and, where applicable, an additional fee in recognition of the higher workload
and extra responsibilities resulting from chairing Board Committees. The Chairman receives an all-inclusive fee as
Chairman of the Board and as a member of all Board Committees (including as Chairman of the Nomination Committee).
Board fees are not paid to Executive Directors and Executive KMP do not receive fees for directorships of any subsidiaries.
Fee Structure
As approved by shareholders at the 2019 Annual General Meeting, the maximum aggregate Non-executive Directors’
fee pool is $950,000 per annum, of which the Group utilised $515,593 in FY21 (FY20: $632,421). Fees paid to Non-executive
Directors are set out in the table below and are inclusive of superannuation. Fees are reviewed annually by the Board.
Board
Audit & Risk
Committee
Remuneration &
Sustainability
Committee
Nomination
Committee
Chair $242,500 $22,500 $22,500 -
Member $122,500 - - -
There were no increases to Board or Committee fees in FY21. In FY21, non-executive Director fees were temporarily reduced
by an equivalent 33% from 1 July 2020 – 31 July 2020, having been reduced from 1 April 2020.
Non-executive Directors do not receive incentive payments, nor are they entitled to participate in any Group employee
statutory superannuation contributions, where applicable. Non-executive Directors are reimbursed for expenses properly
incurred in performing their duties as a Director of the Group. This policy is consistent with Non-Executive Directors being
responsible for objective and independent oversight of the Group.
Remuneration Report Continued
1 Executives who became KMP during the year. Cale Bennett commenced as a KMP on 1 March 2021. Kevin O'Malley commenced as a KMP
on 1 November 2020.
64
CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Statutory KMP Remuneration
Name Year
Fixed Remuneration Variable remuneration
Total
$
Perfor-
mance
Related
%
Cash
salary and
fees
$
Non-cash
1
$
Leave
2
$
Superan-
nuation
$
Short
term
incentive
$
Equity
incentive
3
$
Non-Executive
Directors
Ewen Crouch AM
FY21 229,961 - - 4,834 - - 234,795 N/A
FY20 211,662 - - 10,615 - - 222,277 N/A
Sophie Mitchell
FY21 128,218 - - 12,181 - - 140,399 N/A
FY20 95,205 - - 9,044 - - 104,249 N/A
Jon Brett
FY21 128,218 12,181 - - 140,399 N/A
FY20 40,178 - - 3,817 - - 43,995 N/A
Stephen Lonie
FY21 - - - - - - - N/A
FY20 39,346 - - 3,738 - - 43,084 N/A
Greg Moynihan
FY21 - - - - - - - N/A
FY20 94,273 - - 8,956 - - 103,229 N/A
Admiral Robert
Natter
6
FY21 - - - - - - - N/A
FY20 115,587 - - - - - 115,587 N/A
Sub-Total
Non-Executive
Directors
FY21 486,397 - - 29,196 - - 515,593 N/A
FY20 596,251 36,170 632,421 N/A
Executive
Directors
Jamie Pherous
FY21 460,955 8,342 1,913 21,694 - - 492,904 0%
FY20 441,164 8,983 (35,140) 21,003 - - 436,010 0%
FY21 682,498 9,426 41,045 21,694 - 866,592 1,621,255 53%
FY20 653,171 10,104 (49,529) 21,003 - (489,498) 145,252 0%
Sub-Total
Executive
Directors
FY21 1,143,453 17,768 42,958 43,388 -
866,592
2,114,159
FY20 1,094,335 19,087 (84,669) 42,006 - (489,498) 581,261
Remuneration Report Continued
1
2
Leave represents the movement in the annual leave and long service leave provision balances. The accounting value may be negative, for example, where a
KMP leave balance decreases as a result of taking more leave than the leave entitlement accrued during the year.
3
For accounting purposes, equity incentives are calculated at fair value on grant date and expensed over the performance period, in accordance with AASB 2
Share Based Payments. The accounting value may be negative where SARs are forfeited, resulting in amounts expensed in prior years being reversed. There
can also be a reversal of amounts expensed where there is a reduction in the probability of performance conditions being met.
4
KMP who ceased to be a KMP during FY21. Neale O’Connell ceased to be a KMP on 26 February 2021 after retiring as Global CFO. Mr O’Connell’s services were
retained after his retirement under a consultancy agreement which ended on 30 June 2021, during which period he was paid $30,800 for his consultancy
services. Maureen Brady ceased to be a KMP on 30 October 2020 but remains employed by CTM as COO – North America.
5
Commenced as KMP during FY21. Cale Bennett commenced as a KMP on 1 March 2021. Kevin O’Malley commenced as a KMP on 1 November 2020.
6
Payments made to Admiral Robert Natter, Larry Lo, Debbie Carling, Kevin O’Malley, Maureen Brady, Stephen Fleming and Chris Thelen are in local currency and
converted at average exchange rates.
65
CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Name Year
Fixed Remuneration Variable remuneration
Total
$
Perfor-
mance
Related
%
Cash
salary and
fees
$
Non-cash
1
$
Leave
2
$
Superan-
nuation
$
Short
term
incentive
$
Equity
incentive
3
$
Other Key Management Personnel (Group)
Neale O’Connell
4
FY21 297,879 6,012 (5,424) 17,071 - 164,698 480,236 34%
FY20 401,007 8,817 16,499 21,003 - - 447,326 0%
Cale Bennett
5
FY21 128,067 2,500 5,906 7,093 - 127,050 270,616 47%
FY20 - - - - - - - -
Larry Lo
6
FY21 548,960 - 16,250 3,106 - 178,913 747,229 24%
FY20 524,646 - (8,517) 3,436 - (244,749) 274,816 0%
Debbie Carling
6
FY21 343,213 - 15,127 10,503 - 178,913 547,756 33%
FY20 333,635 636 10,353 - (244,749) 99,875 0%
Greg McCarthy
FY21 385,761 - 9,922 21,694 - 178,913 596,290 30%
FY20 305,309 - (8,463) 21,003 - (160,153) 157,696 0%
Kevin O’Malley
5, 6
FY21 384,661 17,803 13,512 - - 260,909 676,885 38%
FY20 - - - - - - - -
Maureen Brady
4, 6
FY21 103,204 - 13,660 - - - 116,864 0%
FY20 109,166 3,494 - - - - 112,660 0%
Stephen Fleming
6
FY21 - - - - - - - -
FY20 14,070 - 3,968 1,338 - 5,176 24,552 -
Chris Thelen
6
FY21 - - - - - - - -
FY20 530,931 5,860 - - - (244,749) 292,042 -
Sub-Total
Other Key
Management
Personnel
FY21 2,191,745 26,315 68,953 59,467 - 1,089,396 3,435,876
FY20
2,218,764
18,171 4,123 57,133 - (889,224) 1,408,967
Total
FY21 3,821,595 44,083 111,911 132,051 -
1,955,988
6,065,628
FY20 3,909,350 37,258 (80,546) 135,309 - (1,378,722) 2,622,649
1
2
Leave represents the movement in the annual leave and long service leave provision balances. The accounting value may be negative, for example, where a
KMP leave balance decreases as a result of taking more leave than the leave entitlement accrued during the year.
3
For accounting purposes, equity incentives are calculated at fair value on grant date and expensed over the performance period, in accordance with AASB 2
Share Based Payments. The accounting value may be negative where SARs are forfeited, resulting in amounts expensed in prior years being reversed. There
can also be a reversal of amounts expensed where there is a reduction in the probability of performance conditions being met.
4
KMP who ceased to be a KMP during FY21. Neale O’Connell ceased to be a KMP on 26 February 2021 after retiring as Global CFO. Mr O’Connell’s services were
retained after his retirement under a consultancy agreement which ended on 30 June 2021, during which period he was paid $30,800 for his consultancy
services. Maureen Brady ceased to be a KMP on 30 October 2020 but remains employed by CTM as COO – North America.
5
Commenced as KMP during FY21. Cale Bennett commenced as a KMP on 1 March 2021. Kevin O’Malley commenced as a KMP on 1 November 2020.
6
Payments made to Admiral Robert Natter, Larry Lo, Debbie Carling, Kevin O’Malley, Maureen Brady, Stephen Fleming and Chris Thelen are in local currency and
converted at average exchange rates.
The table above is prepared in accordance with the Corporations Act 2001 requirements. The amounts that appear under
the heading 'Equity incentive' represent the amounts expensed by the Group in accordance with the required Accounting
Standards in respect of current and past incentive allocations of share appreciation rights. These amounts are therefore
not amounts actually received by Executive KMP during the year. Whether Executive KMP receive any value from the
allocation of equity incentives in the future will depend on whether applicable performance conditions are met.
Remuneration Report Continued
66 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Other information
Minimum Shareholding Guidelines for Non-executive Directors
To align the Non-executive Directors’ interest with the interests of shareholders, the Board has established guidelines to
encourage Non-executive Directors to progressively acquire and hold shares within three years of their appointment with
a value equal to 100% of base fees. Direct and indirect holdings count towards the minimum shareholding target.
Minimum Shareholding Guidelines for ExecutiveKMP
Executive KMP are encouraged to progressively, through participation in the Group’s equity incentive program, acquire
and hold shares over a reasonable period from the date of their appointment. They are expected to hold a minimum
number of shares commensurate to their role and responsibilities. Direct and indirect holdings together with unvested
equity will count towards the minimum shareholding target.
Equity instruments held by Key ManagementPersonnel
The tables below show the number of shares and share appreciation rights held by Non-executive Directors and Executive
Ordinary Shares
Balance as at
30 June 2020 Purchased Disposed
Received on
vesting of
rights
Other
changes
during the
year
Balance
at 30 June
2021
Non-Executive Directors
Ewen Crouch AM 10,000 2,482 - - - 12,482
Jon Brett 1,000 249 - - - 1,249
Sophie Mitchell 22,122 5,490 - - - 27,612
Executive Directors
Jamie Pherous 21,266,893 67,410 (1,500,000) - (594,303)
1
19,240,000
237,531 - (187,531) - - 50,000
Other Key Management Personnel
Cale Bennett
2
N/A - - - - -
Kevin O’Malley
2
N/A 102,429 - - - 102,429
Larry Lo 161,632 10,000 (50,000) - - 121,632
Debbie Carling 38,578 - (5,000) - - 33,578
Greg McCarthy 97,627 29,072 (37,000) - - 89,699
Neale O’Connell
3
10,172 3,263 - - - N/A
Maureen Brady
3
0 - - - - N/A
1
Jamie Pherous was a director and 25% shareholder of Shamiz Pty Ltd and therefore had a relevant interest in the CTM ordinary shares held by Shamiz Pty Ltd,
as trustee of the Sami Superannuation Fund. On 24 November 2020, Jamie Pherous disposed of his 25% shareholding interest in Shamiz Pty Ltd and ceased to
be a shareholder (and director) of Shamiz Pty Ltd and therefore ceased to have a relevant interest in the CTM ordinary shares held by Shamiz Pty Ltd, as trustee
of the Sami Superannuation Fund.
2
Commenced as KMP during the year. Cale Bennett commenced as a KMP on 1 March 2021. Kevin O’Malley commenced as a KMP on 1 November 2020.
3
Ceased as KMP during the year. Neale O’Connell ceased as a KMP on 26 February 2021 after retiring as Global CFO. Maureen Brady ceased as a KMP on 30
October 2020 but remains employed by CTM as COO – North America.
Remuneration Report Continued
67CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Share Appreciation Rights
Balance as at
30 June 2020
Awarded
during
the year
Vested
during
the year
3
Forfeited
during
the year
Other
changes
during
the year
Balance
at 30 June
2021
Executive Directors
Jamie Pherous - - - - - -
400,000 187,500 - (150,000) - 437,500
Other Key Management Personnel
Cale Bennett
1
N/A 100,000 - - 85,000 185,000
Larry Lo 225,000 112,500 - (75,000) - 262,500
Debbie Carling 225,000 112,500 - (75,000) - 262,500
Greg McCarthy 175,000 112,500 - - - 287,500
Kevin O’Malley
1
N/A 187,500 - - - 187.500
Neale O’Connell
2
100,000 150,000 - (100,000) - N/A
Maureen Brady
2
50,000 112,500 - - - N/A
1
Commenced as KMP during the year. Cale Bennett commenced as a KMP on 1 March 2021. Kevin O’Malley commenced as a MKP on 1 November 2020. Other
changes represent SARs held at the time of commencing as KMP.
2
Ceased as KMP during the year. Neale O’Connell ceased as a KMP on 26 February 2021 after retiring as Global CFO. Maureen Brady ceased as a KMP on 30
October 2020 but remains employed by CTM as COO – North America.
3
FY21 Retention SARs vested on 1 July 2021
Securities Trading Policy
The Group’s Securities Trading Policy prohibits employees
from dealing in CTM securities while in possession of
material non-public information relevant to CTM. It also
prohibits entry into transactions in associated products
that limit the economic risk of participating in unvested
entitlements under equity-based remuneration schemes.
Shares under option
There are currently no unissued ordinary shares of CTM
under option. No share options were granted as equity
Loans to KMP
There have been no loans granted to Non-executive
Directors and Executive KMP of the Company or their
related entities (FY20: nil).
Other transactions and balances with key
management personnel
Contingent consideration of $700,000 in relation to the
acquisition of SCT Travel Group Pty Ltd was earned during
In the normal course of business, the Group may enter
into transactions with various entities that have Directors
in common with CTM. Transactions with these entities are
made on commercial arm’s length terms and conditions.
The relevant Directors do not participate in any decisions
regarding these transactions.
Non-executive Directors and Executive KMP can
acquire travel and event management services from
the Group. All transactions are made on normal
commercial terms and conditions and at market rates.
There are no amounts outstanding in relation to these
transactions at 30 June 2021.
Remuneration Report Continued
68 CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
Insurance of ofcers and indemnities
insurance policies and paid an insurance premium in
respect of the insurance policies, to the extent permitted
by the Corporations Act 2001 (Cth). The insurance policies
cover former Directors of the Company along with the
and employees of the Company and its related bodies
corporate are also covered.
In accordance with Rule 24 of its Constitution, the
Company, to the maximum extent permitted by law,
must indemnify any current or former Director or
Company Secretary and current or former executive
corporate, against all liabilities incurred in those
capacities. For the year ended 30 June 2021, no amounts
have been paid pursuant to indemnities (FY20: nil).
A Deed of Indemnity, Access and Insurance is in place
between the Company and Directors, the Company
Secretary and some other current and former executives.
permitted by law, against liabilities, including costs and
expenses, incurred as a result of acting in their capacity as
The Company’s Constitution also allows the Company
to pay insurance premiums for contracts insuring the
and legal costs. The Directors have not included details
of the nature of the liabilities covered or the amount of
liability insurance contract, as, in accordance with normal
commercial practice, such disclosure is prohibited under
the terms of the contract.
Indemnication of auditors
To the extent permitted by law, the Company has agreed
to indemnify its auditors, PwC, as part of the terms of its
audit engagement agreement against claims by third
parties arising from the audit. No payment has been
Proceedings on behalf of the Company
No person has applied to the Court under section 237
of the Corporations Act for leave to bring proceedings
on behalf of the Company, or to intervene in any
proceedings to which the Company is a party, for
the purpose of taking responsibility on behalf of the
Company for all or part of those proceedings.
No proceedings have been brought or intervened in on
behalf of the Company with the lease of the Court under
section 237 of the Corporations Act.
Non-Audit Services
PwC provided $359,320 of non-audit services during the
year ended 30 June 2021, comprising:
Tax compliance services - $117,418
Tax advisory services - $227,402
Other advisory services - $14,500
non-audit services is compatible with the general
standard of independence for auditors in accordance
with the Corporations Act 2001 (Cth). The nature, value
and scope of each type of non-audit service provided is
considered by the Directors not to have compromised
auditor independence.
Auditor’s Independence Declaration
The Auditor’s Independence Declaration for the year
ended 30 June 2021 has been received from PwC. This is
set out at page 70 of the Directors’ Report.
Rounding of amounts
Amounts in the Directors’ Report are presented in
Australian dollars (unless otherwise indicated) with
values rounded to the nearest thousand dollars, or in
certain cases, the nearest dollar, in accordance with
the Australian Securities and Investments Commission
Corporations (Rounding in Financial/Directors’ Reports)
instrument 2016/191.
This Report is made in accordance with a resolution of the
Directors and is signed for and on behalf of the Board.
Mr Ewen Crouch AM
Chairman
Mr Jamie Pherous
Managing Director
18 August 2021
Brisbane
69CORPORATE TRAVEL MANAGEMENT ANNUAL REPORT 2021
Directors' Report
Continued
PricewaterhouseCoopers, ABN 52 780 433 757
480 Queen Street, BRISBANE QLD 4000, GPO Box 150, BRISBANE QLD 4001
T: +61 7 3257 5000, F: +61 7 3257 5999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.
Auditor’s Independence Declaration
As lead auditor for the audit of Corporate Travel Management Limited for the year ended
30 June 2021, I declare that to the best of my knowledge and belief, there have been:
(a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
(b) no contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Corporate Travel Management Limited and the entities it controlled
during the period.
Michael Crowe
Brisbane
Partner
PricewaterhouseCoopers
18 August 2021
70 CORPORATE TRAVEL MANAGEMENT
Consolidated
Financial Statements
71 ANNUAL REPORT 2021
Consolidated Statement of Financial Position 74
Consolidated Statement of Changes in Equity 75
Consolidated Statement of Cash Flows 76
Notes to the Consolidated Financial Statements 77
Directors’ Declaration 134
Independent Auditor’s Report to the Members of Corporate Travel Management Limited 135
Shareholder Information 142
General information
Corporate Travel Management Limited is a listed public company limited by shares, incorporated and
Level 24,
307 Queen Street
Brisbane
Queensland 4000
Consolidated
Financial Statements
72 CORPORATE TRAVEL MANAGEMENT
Loss and Other Comprehensive Income
For the year ended 30 June 2021
Note
2021
$'000
2020
$'000
Revenue 4 174,046 316,364
Other Income 5 26,406 33,541
Total revenue and other income 200,452 349,905
Operating Expenses
(164,855) (213,987)
Information technology and telecommunications (29,220) (36,377)
Occupancy (3,820) (4,863)
Travel and entertainment (501) (3,758)
Cost of goods sold (8,176) -
Administrative and general (24,098) (26,898)
Depreciation and amortisation 10, 16, 26 (40,857) (42,512)
Impairment 10, 16 (1,261) (23,643)
Total operating expenses (272,788) (352,038)
Operating loss (72,336) (2,133)
Finance costs 18 (3,267) (9,620)
Loss before income tax benet from continuing operations (75,603) (11,753)
8 19,018 1,129
(56,585) (10,624)
(1,176) -
Loss after income tax (expense)/benet for the year (57,761) (10,624)
Other comprehensive income/(loss)
Items that may be reclassied to prot or loss:
Exchange differences on translation of foreign operations
(28,400) 6,330
Other comprehensive income/(loss) for the year, net of tax (28,400) 6,330
Total comprehensive income/(loss) for the year (86,161) (4,294)
Loss for the year is attributable to:
Non-controlling interest 29 (2,410) (2,439)
Ordinary Equity Holders of Corporate Travel Management Limited 24 (55,351) (8,185)
(57,761) (10,624)
Total comprehensive loss for the year is attributable to:
Continuing operations (3,856) (1,851)
Discontinued operations - -
Non-controlling interest (3,856) (1,851)
Continuing operations (81,129) (2,443)
Discontinued operations (1,176) -
Ordinary Equity Holders of Corporate Travel Management Limited (82,305) (2,443)
(86,161) (4,294)
Cents Cents
Earnings per share for loss attributable to the ordinary equity holders
of Corporate Travel Management Limited
Basic earnings per share 6 (43.0) (7.5)
Diluted earnings per share 6 (43.0) (7.5)
The above Consolidated Statement of Prot or Loss and Other Comprehensive Income should be read in conjunction with the accompanying notes.
73
ANNUAL REPORT 2021
Consolidated Statement
of Financial Position
As at 30 June 2021
Note
2021
$'000
2020
$'000
ASSETS
Current assets
Cash and cash equivalents 11 99,018 92,843
Trade and other receivables 12 175,428 64,535
Inventory 13 884 -
Income tax receivable 9,541 11,657
Other assets 5,803 4,787
Total current assets 290,674 173,822
Non-current assets
Trade and other receivables 12 398 -
Investments accounted for using the equity method 14 2,849 -
15 4,423 -
Property, plant and equipment 26 11,155 12,091
Right-of-use assets 16 40,526 46,828
Intangible assets 10 756,918 524,458
Deferred tax assets 8 28,805 6,318
Total non-current assets 845,074 589,695
Total assets 1,135,748 763,517
LIABILITIES
Current liabilities
Trade and other payables 17 204,745 100,499
Borrowings 18 - -
Lease liabilities 19 9,193 8,672
Provisions 21 18,155 33,826
Total current liabilities 232,093 142,997
Non-current liabilities
Trade and other payables 17 9,998 522
Borrowings 18 - -
Lease liabilities 19 37,188 44,423
Deferred tax liabilities 8 1,400 12,095
Provisions 21 3,612 5,393
Total non-current liabilities 52,198 62,433
Total liabilities 284,291 205,430
Net assets 851,457 558,087
EQUITY
Contributed equity 22 744,581 375,314
Reserves 23 3,484 20,174
Retained earnings 24 87,994 143,345
Equity attributable to the equity holders of Corporate Travel Management Limited 836,059 538,833
Non-controlling interests - equity 29 15,398 19,254
Total equity 851,457 558,087
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
74
CORPORATE TRAVEL MANAGEMENT
Consolidated Statement
of Changes in Equity
For the year ended 30 June 2021
Contributed
equity
$'000
Reserves
$'000
Retained
earnings
$'000
Non-
controlling
interests
$'000
Total equity
$'000
Balance at 1 July 2019 364,368 27,001 175,483 23,608 590,460
Loss after income tax expense for the year - - (8,185) (2,439) (10,624)
Other comprehensive income for the year, net of tax - 5,742 - 588 6,330
Total comprehensive income for the year - 5,742 (8,185) (1,851) (4,294)
Transactions with ordinary equity holders in their
capacity as ordinary equity holders:
Contributions of equity, net of transaction costs (note 22) 10,946 - - - 10,946
Share-based payments (note 28) - (12,569) - - (12,569)
Dividends paid (note 7) - - (23,953) (2,503) (26,456)
Balance at 30 June 2020 375,314 20,174 143,345 19,254 558,087
Contributed
equity
$'000
Reserves
$'000
Retained
earnings
$'000
Non-
controlling
interests
$'000
Total equity
$'000
Balance at 1 July 2020 375,314 20,174 143,345 19,254 558,087
- - (55,351) (2,410) (57,761)
Other comprehensive loss for the year, net of tax - (26,954) - (1,446) (28,400)
Total comprehensive loss for the year - (26,954) (55,351) (3,856) (86,161)
Transactions with ordinary equity holders in their
capacity as ordinary equity holders:
Contributions of equity, net of transaction costs (note 22) 369,267 - - - 369,267
Share-based payments (note 28) - 10,264 - - 10,264
Balance at 30 June 2021 744,581 3,484 87,994 15,398 851,457
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes
75
ANNUAL REPORT 2021
Consolidated Statement
of Cash Flows
For the year ended 30 June 2021
Note
2021
$'000
2020
$'000
Cash ows from operating activities
Receipts from customers (inclusive of consumption tax) 114,285 630,031
Payments to suppliers and employees (inclusive of consumption tax) (170,294) (525,483)
Transaction costs relating to acquisitions (7,153) (70)
Interest received 82 261
Finance costs (3,258) (4,338)
Income taxes received/(paid) 5,982 (21,152)
Net cash from/(used in) operating activities 11 (60,356) 79,249
Cash ows from investing activities
Payments for property, plant and equipment 26 (802) (2,637)
Payments for intangibles 10 (14,545) (19,588)
Proceeds from sale of property, plant and equipment 125 3
Payments of contingent/deferred consideration relating to acquisitions 9 - (700)
Payments relating to purchase of controlled entities, net of cash acquired 9 (276,147) (22,763)
Proceeds from sale of subsidiary 2,867 -
(886) -
Net cash (used) in investing activities (289,388) (45,685)
Cash ows from nancing activities
Proceeds from issue of new shares 379,830 -
Share issue transaction costs 22 (11,115) (10)
Proceeds from borrowings - 206,581
Repayments of borrowings - (252,985)
Release of secured deposits (317) 6,014
Dividends paid to company’s shareholders 7 - (23,953)
Dividends paid to non-controlling interests in subsidiaries - (2,503)
Principal elements of lease payments (9,315) (7,745)
359,083 (74,601)
Net increase/(decrease) in cash and cash equivalents 9,339 (41,037)
92,843 138,791
Effects of exchange rate changes on cash and cash equivalents (3,164) (4,911)
Cash and cash equivalents at the end of the nancial year 99,018 92,843
The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes
76
CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Note 1. Basis of preparation 78
Note 2. Critical accounting judgements, estimates and assumptions 79
Note 3. Segment reporting 80
Note 4. Revenue 82
Note 5. Other income 84
Note 6. Earnings per share 85
Note 7. Dividends paid and proposed 86
87
Note 9. Business combinations 91
Note 10. Intangible assets 94
Note 11. Cash and cash equivalents 96
Note 12. Trade and other receivables 97
Note 13. Inventory 98
Note 14. Investments accounted for using the equity method 99
100
Note 16. Right-of-use assets 101
Note 17. Trade and other payables 102
Note 18. Borrowings 103
Note 19. Lease liabilities 104
Note 20. Financial risk management 105
Note 21. Provisions 109
Note 22. Contributed equity 111
Note 23. Reserves 112
Note 24. Retained earnings 113
Note 25. Impairment testing of goodwill 114
Note 26. Property, plant and equipment 116
Note 27. Fair value measurement 118
Note 28. Share-based payments 119
Note 29. Interest in other entities 122
Note 30. Related party transactions 125
Note 31. Parent entity information 126
Note 32. Deed of cross guarantee 128
Note 33. Auditors’ remuneration 130
131
Note 35. Events after the reporting period 133
77 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
(a) Basis of consolidation
Limited and its controlled entities (“CTM” or “the Group”).
Subsidiaries are all entities over which the Group has
control. The Group controls an entity when the Group
is exposed to, or has right to, variable returns from its
involvement with the entity and has ability to affect
those returns through its power to direct the activities
of the entity.
the same reporting period as the parent company, using
consistent accounting policies. For subsidiaries acquired
be prepared from the date control is transferred to the
Group through to the end of the current reporting period.
Adjustments are made to bring into line any dissimilar
accounting policies that may exist.
intercompany balances and transactions, income and
transactions have been eliminated in full.
Subsidiaries are fully consolidated from the date on which
control is transferred to the Group and deconsolidated
from the date that control ceases.
(b) Foreign currency translation
(i) Functional and presentation currency
statements are measured using the currency of the
primary economic environment in which the entity
operates (‘the functional currency’). The consolidated
which is the Group’s functional and presentation currency.
(ii) Transactions and balances
Foreign currency transactions are translated into
the functional currency using the exchange rates
prevailing at the transaction dates. Foreign exchange
gains and losses resulting from the settlement of
such transactions and from the translation at year-
end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in the
or Loss and Other Comprehensive Income, except when
qualifying net investment hedges.
assets and liabilities, such as equities held at fair value
Comprehensive Income as part of the fair value gain or loss.
(iii) Foreign operations
operations that have functional currencies different
to the presentation currencies are translated into the
presentation currency as follows:
Assets and liabilities for each Consolidated Statement
of Financial Position item presented are translated at
the closing rate at the date of that statement;
Other Comprehensive Income are translated at
average exchange rates; and
All resulting exchange differences are recognised as a
separate component of equity.
Exchange differences arising from the translation
of any net investment in foreign operations and of
as hedges of such investments are recognised in other
comprehensive income. When a foreign operation is sold
or any borrowings forming part of the net investment are
repaid, a proportionate share of such exchange differences
Income as part of the gain or loss on sale.
Goodwill and fair value adjustments arising on the
acquisition of foreign operations are treated as the
foreign operations’ assets and liabilities and translated
at the closing rate.
Note 1. Basis of preparation
78 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Estimates and judgements are continually evaluated
and are based on historical experience and other factors,
including expectations of future events that may have a
be reasonable under the circumstances.
In the process of applying the Group’s accounting policies,
management is required to exercise judgement. Those
judgements involving estimations that may have an effect
The Group makes estimates, assumptions and
judgements concerning the future. The resulting
the related actual results. The judgements, estimates
a material adjustment to the carrying amounts of assets
in this report, as follows:
Value of intangible assets relating to acquisitions:
Refer note 9 'Business combinations'.
Refer note 10 'Intangible assets'.
Software developed or acquired not as part of a
business combination:
Refer note 10 'Intangible assets'.
Impairment testing of goodwill:
Refer note 25 'Impairment testing of goodwill'.
Expected credit losses:
Refer note 20 'Financial risk management'.
Provisions:
Refer note 21 'Provisions'.
Share based payments:
Refer note 28 'Share-based payments'.
Value of investments:
Refer note 9 'Business combinations'.
Refer note 14 'Investments accounted for using the
equity method'.
Refer note 15 'Financial assets at fair value through
The recognition and recoverability of a net deferred tax
asset relating to income tax losses:
Refer note 8 'Income tax'.
Judgements and estimates as a result of the
Coronavirus (COVID-19) pandemic
The impact of COVID-19 is expected to last for several
years, necessitating additional judgements and
estimates which involve assumptions. Key judgements
require an assessment of forecast performance of the
Group and its businesses, and, at the time of this report,
those assessments have inherent uncertainty.
These judgements were made based on the best available
information to date regarding the circumstances existing
at 30 June 2021 including key assumptions as set out
above. Evidence since the reporting date to the date
adjustments made where required. The assumptions
made should not be taken to indicate the outcome of
future Group decisions. Should actual performance differ
material changes to the carrying value of the assets and
liabilities in future reporting periods.
Consideration of liquidity risk
The impact of COVID-19 has had a negative impact
covenants with its lenders for the testing periods
through until 31 December 2021. Covenant testing for
the period ending 31 December 2021 will be based on
1H22 performance.
position deteriorates further, there is no guarantee
that it will be able to obtain further relief from covenant
testing in the future. In such circumstances, the Group's
banks may require loans to be repaid immediately,
which may have an adverse effect on the Group’s future
However, CTM’s modelling indicates that, as a result of the
actions it has taken to date and notwithstanding ongoing
cash holdings and no debt, coupled with the continued
activity of its clients and the market, ensures that it has the
capacity to continue through the challenges caused by the
impacts of the COVID-19 pandemic.
Refer to Note 20(c) for further information in relation
to Liquidity risk.
Note 2. Critical accounting judgements, estimates and assumptions
79 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
(a) Description of segments
The operating segments are based on the reports reviewed by the Chief Operating Decision Makers ('CODMs') who assess
performance and determine resource allocation.
operating Travel and related service segments being Australia and New Zealand, North America, Asia, and Europe. There
are currently no non-reportable segments.
(b) Segment information provided to the Chief Operating Decision Makers
The CODMs assess the performance of the operating segments based on a measure of underlying EBITDA. This
measurement basis excludes the effects of the costs of acquisitions, acquisition related adjustments, and other non-
recurring items during the year.
The segment information provided to the CODMs for the reportable segments for the year ended 30 June 2021 is as follows:
June 2021
Australia and
New Zealand
$’000
North
America
$’000
Asia
$’000
Europe
$’000
Other*
$’000
Total
$’000
Total revenue from external parties 34,619 92,691 8,506 38,230 - 174,046
Other income 7,399 3,331 10,380 3,767 1,529 26,406
Total revenue and other income 42,018 96,022 18,886 41,997 1,529 200,452
Underlying EBITDA 7,745 (10,724) (5,355) 10,119 (9,034) (7,249)
Total segment assets 122,027 536,324 147,721 307,345 22,331 1,135,748
Total segment liabilities 44,308 76,234 38,428 123,000 2,321 284,291
June 2020
Australia and
New Zealand
$’000
North
America
$’000
Asia
$’000
Europe
$’000
Other*
$’000
Total
$’000
Total revenue from external parties 77,946 113,623 49,994 74,801 - 316,364
Other income 3,399 20,663 3,196 3,022 3,261 33,541
Total revenue and other income 81,345 134,286 53,190 77,823 3,261 349,905
Underlying EBITDA 32,780 14,740 6,842 26,745 (6,708) 74,399
Total segment assets 110,173 281,071 152,988 185,488 33,797 763,517
Total segment liabilities 41,585 44,642 81,037 36,306 1,860 205,430
* The other segment represents the Group’s support service, created to support the operating segments and growth of the global business.
Note 3. Segment reporting
80 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
(c) Other segment information
Underlying EBITDA
The reconciliation of underlying Statutory EBITDA to underlying and statutory loss before income tax is provided as follows:
2021
$'000
2020
$'000
Underlying EBITDA to Statutory EBITDA reconciliation
Underlying EBITDA (7,249) 74,399
Discontinued operations (755) 0
Comprehensive underlying EBITDA (8,004) 74,399
EBITDA non-recurring items
Acquisition costs (7,153) 0
Integration costs (11,471) 0
Gain on sale of DVI 970 0
US legal settlement 0 (3,138)
Other (2,876) (518)
COVID-19 impacts
Bad and doubtful debts (1,199) (13,034)
Redundancy costs (1,322) (15,056)
Contingent consideration adjustment 0 21,108
Total EBITDA non-recurring items (23,051) (10,638)
Statutory EBITDA (31,055) 63,761
Underlying EBITDA to underlying and statutory loss before tax
Underlying EBITDA (7,249) 74,399
Interest revenue 82 261
Finance costs (1,728) (4,328)
Interest on lease liabilities (1,539) (1,813)
Depreciation - Property, plant and equipment (4,720) (3,841)
Depreciation - Right-of-use assets (9,384) (9,257)
Amortisation - Intangibles (18,711) (14,062)
Impairment - Intangibles (358) (2,128)
Underlying loss before income tax benet from continuing operations (43,607) 39,231
PBT non-recurring items
Total EBITDA non-recurring items (23,051) (10,638)
Right-of-use assets - impairment (integration costs) (903) 0
Amortisation - intangibles 0 (9,075)
Impairment - software WIP 0 (1,361)
Impairment - goodwill 0 (20,154)
COVID-19 impacts
Borrowing cost acceleration 0 (3,479)
Total PBT non-recurring items (23,954) (44,707)
Amortisation - client contracts and relationships (8,042) (6,277)
Loss before income tax benet from continuing operations (75,603) (11,753)
Accounting policy
AASB 8 Operating Segments requires a ‘management approach’, under which segment information is presented on the
same basis as that used for internal reporting purposes.
Operating segments are reported in a manner that is consistent with the internal reporting provided to the Chief
strategic decisions. Goodwill is allocated by management to groups of cash-generating units on a segment level.
Note 3. Segment reporting continued
81 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
(a) Disaggregation of revenue from contracts with customers
2021
Australia and
New Zealand
$’000
North
America
$’000
Asia
$’000
Europe
$’000
Other
$’000
Total
$’000
Transactional revenue 31,033 72,006 8,269 36,452 - 147,760
Volume based incentive revenue 617 5,992 207 608 - 7,424
Revenue from sale of inventory - 10,339 - - - 10,339
Licensing revenue 2,474 4,326 - 1,169 - 7,969
Other revenue 495 28 30 1 - 554
Total revenue from external parties 34,619 92,691 8,506 38,230 - 174,046
2020
Australia and
New Zealand
$’000
North
America
$’000
Asia
$’000
Europe
$’000
Other
$’000
Total
$’000
Transactional revenue 72,465 100,487 35,958 67,731 - 276,641
Volume based incentive revenue 5,226 12,730 13,961 5,837 - 37,754
Revenue from sale of inventory - - - - - -
Licensing revenue - - - 1,233 - 1,233
Other revenue 255 406 75 - - 736
Total revenue from external parties 77,946 113,623 49,994 74,801 - 316,364
(b) Assets related to contracts with customers
The Group has contract assets related to contracts with customers:
2021
$'000
2020
$'000
Contract assets 3,674 8,522
Contract assets represent only current balances for amounts outstanding from suppliers for volume based incentive revenue.
Note 4. Revenue
82 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Accounting policy
Transactional revenue
Transactional revenue is revenue derived from clients and
suppliers generated from the provision of travel services
to clients. The performance obligation is the facilitation of
travel related services on behalf of clients. Transactional
is recognised at either the ticketed date of the travel
booking or on the date of travel, depending on the terms
of the contract.
Transactional revenue also includes Pay Direct
Commission, which is recognised when the performance
commission is highly probable, which is either upon
commissionable by the supplier.
Volume based incentive revenue
Volume based incentive revenue is revenue derived
from contracts with suppliers. The revenue is variable
and is dependent upon the achievement of contractual
recognised over time and is measured as the amount that
is deemed highly probable to be received, which has been
determined using the most likely amount method and
the Group’s experience with the contracts.
Revenue from sale of inventory
Revenue from sale of inventory is revenue derived from
the sale of gift cards for loyalty programs within the US
market. This revenue is recognised at the time the order is
dispatched to the customer.
Licensing Revenue
Licensing revenue is revenue derived from the right to use
CTM’s software and travel supply network. This revenue
is recognised over time in-line with the satisfaction of the
performance obligation, being the provision of access to
software and the travel supply network.
Other revenue
Other revenue is recognised when the transfer of the
promised goods or service to the customer has been
completed. Other revenue includes third party licensing
and development fees, interest revenue, rental income,
and other minor operating revenue.
Note 4. Revenue continued
83 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
2021
$'000
2020
$'000
Net foreign exchange gain 2,169 4,071
Government grants 18,401 7,732
Other 5,836 21,738
Other income 26,406 33,541
Income from Government grants as a result of the COVID-19 pandemic have been recognised in other income.
The Group has received government assistance for operations in Australia, New Zealand, Singapore, Hong Kong
(Australia), Employer Wage Subsidy Scheme (New Zealand), Job Support Scheme (Singapore), Employment Support
assistance. Government grant income is offset by the cost of retaining additional staff. In the Asia and Europe regions,
access to the grants was made possible by retaining staff.
'Other' predominately represents research and development tax incentives and the gain on sale of DVI. In FY20 the
'Other' amount predominately represented the non-cash contingent consideration liability reversed as a result of the
reassessment of earn-out provisions from acquisitions. Amounts are recognised where there is reduced probability of the
obligations having to be paid by the Group.
Accounting Policy
Government grants are recognised when there is reasonable assurance that the grant will be received and all
the Group is eligible to receive the contribution, the recognition of the grant as revenue will be deferred until those
Note 5. Other income
84 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Note 6. Earnings per share
2021
$'000
2020
$'000
Loss after income tax (57,761) (10,624)
Non-controlling interest 2,410 2,439
Loss after income tax attributable to the ordinary equity holders
of Corporate Travel Management Limited
(55,351) (8,185)
Number Number
Weighted average number of ordinary shares used as a denominator
in calculating basic earnings per share
128,645,231 108,868,570
Weighted average number of ordinary shares used as a denominator
in calculating diluted earnings per share
128,645,231 108,868,570
Accounting policy
Basic earnings per share
costs of servicing equity (other than dividends) divided by the weighted average number of ordinary shares, adjusted
for any bonus element.
Diluted earnings per share
average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus element, and adjusted for:
Costs of servicing equity (other than dividends);
The after-tax effect of dividends and interest associated with dilutive potential ordinary shares that have
been recognised as expenses; and
Other non-discretionary changes in revenues or expenses during the period that would result from
the conversion into potential ordinary shares.
85 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
Ordinary shares
2021
$'000
2020
$'000
Final ordinary dividend for the prior nancial year ended 30 June - 23,953
Current period
There were no dividends paid, recommended or determined during, or for, the current reporting period.
Franking credit balance
2021
$'000
2020
$'000
Franking credits available for subsequent reporting periods based on a tax rate of 30% (2020: 30%) - (813)
These amounts are calculated from the balance of the franking account as at the end of the reporting period, adjusted for
franking credits and debits that will arise from the settlement of liabilities or of receivables for income tax and dividends
after the end of the year.
Accounting policy
Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the
measured at the present value of management's best estimate of the expenditure required to settle the present
obligation at the end of the reporting period.
Note 7. Dividends paid and proposed
86 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
2021
$'000
2020
$'000
Current income tax
(345) 2,828
Adjustments for current tax of prior periods 531 630
Deferred income tax
(Increase) in deferred tax assets (24,680) (1,350)
Increase/(decrease) in deferred tax liabilities 5,444 (3,237)
Income tax benet (19,050) (1,129)
Loss from continuing operations (19,018) (1,129)
Loss from discontinued operations (32) -
Income tax benet (19,050) (1,129)
Numerical reconciliation of income tax (benet) to prima facie tax payable/(receivable)
(75,603) (11,753)
(1,208) -
(76,811) (11,753)
Tax at the statutory tax rate of 30% (23,043) (3,526)
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Non-deductible amounts 729 6,909
Other amounts 234 (5,727)
(22,080) (2,344)
Adjustments for current tax of prior periods 531 630
Recognition of temporary differences previously not brought to account (921) (177)
Difference in overseas tax rates 4,092 1,168
Research and development tax credit (669) (22)
Utilisation of previously unrecognised tax losses (3) (384)
Income tax benet (19,050) (1,129)
Note 8. Income tax benet
87 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
Deferred income tax
2021
$'000
2020
$'000
Deferred tax assets
The balance comprises temporary differences attributable to:
Provisions 7,115 6,042
5,620 -
Lease liabilities 10,825 11,540
Tax losses 30,495 7,347
Other - 30
54,055 24,959
Set-off of deferred tax liabilities pursuant to set-off provisions (25,250) (18,641)
Net deferred tax assets 28,805 6,318
2021
$'000
2020
$'000
Deferred tax liabilities
The balance comprises temporary differences attributable to:
Depreciation and amortisation 17,345 15,800
Accrued income 281 1,383
Right-of-use assets 9,122 10,070
Other (98) 3,483
26,650 30,736
Set-off of deferred tax assets pursuant to set-off provisions (25,250) (18,641)
Net deferred tax liabilities 1,400 12,095
Note 8. Income tax benet continued
88 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Deferred income tax
Deferred tax assets
At 1 July
$'000
Adjustment
on adoption
of AASB 16
$'000
At 1 July
(Restated)
$'000
(Charged)/
credited
in year via
P&L
$'000
(Charged)/
credited
in year via
equity
$'000
Acquisition
of
subsidiaries
$'000
Disposal of
subsidiaries
$'000
Change
in FX
rates
$'000
At 30
June
$'000
2021
Provisions 6,042 - 6,042 650 553 90 (1) (219) 7,115
(SARs)
- - - 791 4,829 - - - 5,620
Lease liabilities 11,540 - 11,540 (214) - - (12) (489) 10,825
Tax losses 7,347 - 7,347 23,483 - - (117) (218) 30,495
Other 30 - 30 (30) - - - - -
24,959 - 24,959 24,680 5,382 90 (130) (926) 54,055
2020
Provisions 5,774 - 5,774 476 3 - - (211) 6,042
(SARs)
3,641 - 3,641 (1,699) (1,942) - - - -
Lease liabilities - 14,059 14,059 (1,943) - - - (576) 11,540
Tax losses 1,180 - 1,180 4,516 1,941 - - (290) 7,347
Other 30 - 30 - - - - - 30
10,625 14,059 24,684 1,350 2 - - (1,077) 24,959
Deferred tax
liabilities
At 1 July
$'000
Adjustment
on adoption
of AASB 16
$'000
At 1 July
(Restated)
$'000
(Charged)/
credited
in year via
P&L
$'000
(Charged)/
credited
in year via
equity
$'000
Acquisition
of
subsidiaries
$'000
Disposal of
subsidiaries
$'000
Change
in FX
rates
$'000
At 30
June
$'000
2021
Depreciation and
amortisation
15,800 - 15,800 1,889 - 945 24 (1,313) 17,345
Accrued income 1,383 - 1,383 (887) - (136) - (79) 281
Right-of-use assets 10,070 - 10,070 (511) - - (5) (432) 9,122
Other 3,483 - 3,483 4,953 (8,534) - - - (98)
30,736 - 30,736 5,444 (8,534) 809 19 (1,824) 26,650
2020
Depreciation and
amortisation
15,000 - 15,000 (745) - 1,656 - (111) 15,800
Accrued income 2,493 - 2,493 (1,248) - - - 138 1,383
Right-of-use assets - 12,840 12,840 (2,261) - - - (509) 10,070
Other 2,241 - 2,241 1,017 225 - - - 3,483
19,734 12,840 32,574 (3,237) 225 1,656 - (482) 30,736
The Group has tax losses that arose in foreign subsidiaries of $14,754,000 (2020: $3,484,000) that are available for offsetting
expiry date. Deferred tax assets have not been recognised in respect of these losses as they may not be used to offset
Note 8. Income tax benet continued
89 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
Accounting policy
Tax consolidation
Corporate Travel Management Limited and its 100%
owned Australian resident subsidiaries have formed
a tax consolidated group with effect from 1 July 2008.
Corporate Travel Management Limited is the head
entity of the tax consolidated group. Members of the
Group have entered into a tax sharing agreement
in order to enable Corporate Travel Management
Limited to allocate income tax expense to the wholly
owned subsidiaries on a pro-rata basis. In addition, the
agreement provides for the allocation of income tax
liabilities amongst the entities should the head entity
default on its tax payment obligations.
Tax effect accounting by members of the tax
consolidated group
Members of the tax consolidated group have entered into
a tax funding agreement. The tax funding agreement
provides for the allocation of current taxes to members
of the tax consolidated group in accordance with their
allocated to members of the tax consolidated group in
accordance with the principles of AASB 112 Income Taxes.
Allocations under the tax funding agreement are made at
the end of each quarter.
The allocation of taxes under the tax funding agreement
is recognised as an increase/decrease in the subsidiaries’
inter-company accounts with the tax consolidated group
head company, Corporate Travel Management Limited.
tax payable on the current period’s taxable income based
on the applicable income tax rate for each jurisdiction,
adjusted by changes in deferred tax assets and liabilities
attributable to temporary differences and to unused tax
losses. The current income tax charge is calculated on the
basis of the tax laws enacted or substantively enacted at
the end of the reporting period in the countries where the
Group’s subsidiaries and associates operate and generate
taxable income. It includes adjustments for tax expected
to be payable or recoverable in respect of previous periods.
Where the amount of tax payable or recoverable is
uncertain, management establishes provisions based on
either: the Group’s judgment of the most likely amount
of the liability or recovery or; where there is a range
of possible non-binary outcomes, the expected value
calculated under a probability weighted approach.
Deferred income tax is provided for in full, using the
liability method, on temporary differences arising between
the tax bases of assets and liabilities and their carrying
However, the deferred income tax is not accounted for if
it arises from initial recognition of an asset or liability in
a transaction other than a business combination that, at
the time of the transaction, affects neither accounting nor
using tax rates and laws that have been enacted, or
substantially enacted, by the end of the reporting period
and are expected to apply when the related deferred
income tax asset is realised or the deferred income tax
liability is settled.
Deferred tax assets are recognised for deductible
temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to
utilise those temporary differences and losses.
Deferred tax liabilities and assets are not recognised for
temporary differences between the carrying amount and
tax bases of investments in controlled entities where the
parent entity is able to control the timing of the reversal
of the temporary differences and it is probable that the
differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there
is a legally enforceable right to offset current tax assets
and liabilities and when the deferred tax balances relate
to the same taxation authority. Current tax assets and
tax liabilities are offset where the entity has a legally
enforceable right to offset and intends either to settle
on a net basis, or to realise the asset and settle the
liability simultaneously.
except to the extent that it relates to items recognised in
other comprehensive income or directly in equity. In this
case, the tax is also recognised in other comprehensive
income or directly in equity, respectively.
Other taxes
Revenues, expenses and assets are recognised net of the
amount of consumption tax except:
When the GST incurred on a purchase of goods
and services is not recoverable from the taxation
authority, in which case, the consumption tax is
recognised as part of the cost of acquisition of the
asset or as part of the expense item as applicable; and
Receivables and payables, which are stated with the
amount of consumption tax included.
The net amount of consumption tax recoverable from,
or payable to, the taxation authority is included as
part of receivables or payables in the Consolidated
included in the Consolidated Statement of Cash Flows
on a gross basis and the consumption tax component
activities, which is recoverable from, or payable to,
net of the amount of consumption tax recoverable
from, or payable to, the taxation authority.
Note 8. Income tax benet continued
90 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Tramada Holdings Pty Ltd
On 29 October 2020, the Group acquired 100% of the shares of Tramada Holdings Pty Ltd, a travel software provider
based in Sydney, Australia. The cost of the acquisition was $9,353,000. This was paid in cash. There is no earn-out
consideration payable.
There were no acquisition-related costs incurred for the Tramada acquisition.
Trade and other receivables approximate the gross contractual amounts receivable, of which all balances were expected to
be collectable at acquisition date.
29 October 2020 to 30 June 2021. If the acquisition had occurred on 1 July 2020, the Group's consolidated revenue and net
loss after tax for the year ended 30 June 2021 would change from $174,046,000 to $175,658,000 and from $57,761,000 to
$57,459,000 respectively.
Travel and Transport, Inc
On 30 October 2020, the Group acquired 100% of the shares of Travel and Transport, Inc, a corporate travel management
company based in Omaha, USA. The cost of the acquisition was US$209,897,000 (AU$292,494,000), which was paid in cash.
There is no earn-out consideration payable.
Acquisition-related costs of $7,153,000 are included in administrative and general expenses in the Consolidated Statement
Trade and other receivables approximate the gross contractual amounts receivable, adjusted for any balances
expected to be uncollectable.
The acquired business contributed revenues of $55,584,000 and a net loss after tax of $27,467,000 to the Group for the
period 30 October 2020 to 30 June 2021. If the acquisition had occurred on 1 July 2020, the Group's consolidated revenue
and net loss after tax for the year ended 30 June 2021 would change from $174,046,000 to $201,237,000 and from
$57,761,000 to $65,688,000 respectively.
Fair value acquisition consideration and reconciliation to cash ow
Tramada
$'000
T&T
$’000
Initial consideration 8,990 278,980
Working capital adjustment 363 13,514
Total acquisition date fair value consideration 9,353 292,494
Cash paid 9,353 292,494
less: cash balances acquired (95) (25,605)
Total outow of cash - investing activities 9,258 266,889
Note 9. Business combinations
91 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
The fair values of the assets and liabilities of the acquired businesses, as at the date of acquisition, are as follows:
Tramada
$'000
T&T
$’000
Current assets
Cash and cash equivalents 95 25,605
Trade and other receivables 686 13,128
Inventory - 1,177
Other assets 414 4,450
Non-current assets
Investments accounted for using the equity method - 3,193
- 3,748
Property, plant and equipment 279 5,323
Right-of-use assets - 15,079
Intangible assets 89 7,513
Deferred tax asset 182 8
Current liabilities
Trade and other payables (854) (25,127)
Lease liabilities - (2,591)
Provisions (328) (1,731)
Non-current liabilties
Trade and other payables - (10,883)
Lease liabilities - (12,800)
Provisions - (723)
Net identiable assets acquired 563 25,369
Goodwill on acquisition 1,207 231,005
Intangible assets - software 7,155 -
Intangible assets - client contracts and relationships 688 32,500
Intangible assets - brands 451 3,818
Deferred tax liability (711) (198)
Net assets acquired 9,353 292,494
Prior period business combinations
During the year ended 30 June 2021, no contingent consideration relating to the achievement of performance conditions
in FY20 was paid for prior year business combinations.
Accounting policy
The purchase method of accounting is used to account for all business combinations regardless of whether equity
instruments or other assets are acquired. The consideration transferred is measured as the fair value of the assets acquired,
shares issued or liabilities incurred or assumed at the date of exchange. Acquisition-related costs are expensed in the
period in which the costs are incurred.
Where equity instruments are issued in a business combination, the fair value of the instruments is their published market
price as at the date of exchange. Transaction costs arising on the issue of equity instruments are recognised directly
in equity. The consideration transferred also includes the fair value of any asset or liability resulting from a contingent
consideration arrangement.
combination are measured initially at their fair values at the acquisition date. The excess of the consideration transferred,
net assets acquired is recognised as goodwill. If the consideration transferred for the acquisition is less than the Group's
Note 9. Business combinations continued
92 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Where settlement of any part of the cash consideration is deferred, the amounts payable in the future are discounted to their
present value, as at the date of exchange. The discount rate used is the entity's incremental borrowing rate, being the rate at
are subsequently remeasured to fair value, with changes in fair value recognised in other income or other expenses,
Comprehensive Income.
The Group recognises any non-controlling interest, in the acquired entity on an acquisition-by-acquisition basis either at
Non-controlling interests in the results and equity of subsidiaries are shown separately in the Consolidated Statement
Statement of Changes in Equity.
Critical estimates, assumptions and judgements
Value of intangible assets relating to acquisitions
The Group has allocated portions of the cost of acquisitions to client contracts and relationships, software and other
intangibles. Client contracts and relationships were valued using the multi-period excess earnings method. These
Acquired software has been valued using the cost to re-create method. These calculations require the use of assumptions
including the period of time it would take to rebuild the software, the number of people it would take to rebuild the
software and the cost per person to rebuild the software.
Acquired other intangible assets were valued using the relief from royalty method. These calculations require the use of
discount rate.
Value of nancial assets held at fair value through prot or loss and investments accounted for under
the equity method
information provided by the controlling interest for measurement purposes.
The Group has allocated portions of the cost of acquisitions to investments accounted for under the equity method. Whilst
information provided by the investee to calculate the value of these investments.
Note 9. Business combinations continued
93 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
2021
$'000
2020
$'000
Goodwill - at cost 699,677 498,448
Less: Accumulated amortisation & impairment (21,424) (20,237)
678,253 478,211
Client contracts and relationships - at cost 96,928 69,016
Less: Accumulated amortisation (59,873) (53,894)
37,055 15,122
Software - at cost 93,211 72,101
Less: Accumulated amortisation & impairment (54,864) (41,236)
38,347 30,865
Other intangible assets - at cost 4,608 5,181
Less: Accumulated amortisation (1,345) (4,921)
3,263 260
756,918 524,458
Reconciliations
out below:
Client
contracts and
relationships
$'000
Software
$'000
Goodwill
$'000
Other
intangible
assets
$'000
Total
$'000
Balance at 1 July 2019 19,256 30,314 453,522 3,598 506,690
Additions - 19,588 - - 19,588
Additions through business combinations 5,462 - 40,577 180 46,219
Impairment expense - (3,489) (20,154) - (23,643)
Amortisation expense (10,229) (15,580) - (3,605) (29,414)
Exchange differences 633 32 4,266 87 5,018
Balance at 30 June 2020 15,122 30,865 478,211 260 524,458
Additions - 14,522 - 23 14,545
Additions through business combinations (note 9) 33,188 14,668 232,212 4,358 284,426
Disposals - (1,895) - - (1,895)
Impairment expense - (358) - - (358)
Amortisation expense - continuing operations (8,042) (17,614) - (1,097) (26,753)
Amortisation expense - discontinued operations - (323) - - (323)
Exchange differences (3,213) (1,518) (32,170) (281) (37,182)
Balance at 30 June 2021 37,055 38,347 678,253 3,263 756,918
Note 10. Intangible assets
94 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Accounting policy
Client contracts and relationships
The client contracts were acquired as part of a business combination (refer note 9 'Business combinations' for details). They
are recognised at their fair value at the date of acquisition and are subsequently amortised based on the consumption of
Software developed or acquired not as part of a business combination
Costs incurred in developing products or systems and costs incurred in acquiring software and licenses that will
software and systems assets.
Software acquired as part of a business combination
Other
Other intangible assets, such as brand names are recognised at fair value and are amortised over their useful life. Other
in circumstances indicate that the intangible asset may be impaired.
Amortisation expense
A summary of the amortisation policies applied to the Group's intangible assets is as follows:
Item Years Method Acquired/Internally generated
Client contracts and relationships 3 – 6
Straight line or timing of projected
Acquired
Software developed and acquired 3 – 7 Straight line Acquired/Internally generated
Other intangible assets 2 – 10 Straight line Acquired/Internally generated
Impairment expense
impairment. An impairment loss is recognised when the carrying amount exceeds recoverable amount. The recoverable
amount is the higher of fair value less costs of disposals or value-in-use.
Goodwill
Goodwill is reviewed for impairment, annually, or more frequently if events or changes in circumstances indicate that the
carrying value may be impaired (refer note 25 'Impairment testing of goodwill').
Critical estimates, assumptions and judgements
Client contracts and relationships
The Group recognises customer contracts and relationships arising from business combinations. Estimates and
Software developed or acquired not as part of a business combination
The Group recognises internally generated software assets arising from development once they meet the criteria set out
in the Australian Accounting Standards. Estimates are used in determining the useful life for amortisation. There is also
Goodwill
Refer note 25 'Impairment testing of goodwill'.
Software acquired as part of a business combination
Refer to note 9 'Business combinations'
Note 10. Intangible assets continued
95 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
2021
$'000
2020
$'000
Cash at bank and on hand 92,824 90,445
Client cash 6,194 2,398
Total cash and cash equivalents 99,018 92,843
-0.50%-0.08% (2020: 0.00%-1.89%).
Accounting policy
Cash and cash equivalents in the Consolidated Statement of Financial Position comprise cash at bank and on hand and
short term deposits, with an original maturity of three months or less, that are readily convertible to known amounts of
Client cash represents amounts contributed by clients that the Group is required by regulation or contract to hold
separately before release.
For the purpose of the Consolidated Cash Flow Statement, cash and cash equivalents consist of cash and cash equivalents
2021
$'000
2020
$'000
Reconciliation of prot/(loss) after income tax to net cash inow from operating activities
Loss for the year (57,761) (10,624)
Adjustments for: - -
Depreciation and amortisation 41,306 42,512
Impairment of intangible assets 1,261 23,643
Net exchange differences 107 (267)
Non-cash interest 60 5,681
Adjustments relating to acquisitions - (21,107)
5,548 (4,160)
Net gain on disposal of subsidiary (970) -
Fair value adjustment of acquisition payable - (1,015)
Net gain/(loss) on disposal of non-current assets 439 203
Changes in operating assets and liabilities - -
(Increase)/decrease in trade and other receivables (99,803) 286,892
(Increase)/decrease in other assets 3,148 217
(Increase)/decrease in inventory 168 -
Increase/(decrease) in deferred tax balances (18,968) (4,183)
Increase/(decrease) in income tax payable/(receivable) 1,914 (18,095)
Increase/(decrease) in trade and other payables and provisions 63,195 (220,448)
Net cash ow from operating activities (60,356) 79,249
Note 11. Cash and cash equivalents
96 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
2021
$'000
2020
$'000
Current assets
Trade receivables
1
20,378 14,662
Client receivables
1
145,766 32,243
Contract assets 3,416 7,762
169,560 54,667
Deposits
2
5,248 7,887
Other receivables 620 1,981
5,868 9,868
Total current trade and other receivables 175,428 64,535
Non-current assets
Long-term receivables
398 -
Total trade and other receivables 175,826 64,535
1
Trade and client receivables are non-interest bearing and are generally on terms ranging from 7 to 30 days.
2
Deposit balance represents advanced deposits to suppliers and deposits made on behalf of clients for travel which will occur at a future date.
Accounting policy
Trade and client receivables are recognised initially at fair value and, subsequently, measured at amortised cost using the
Financial Instruments (AASB 9).
permits the use of the lifetime expected loss provision for all trade and client receivables and contract assets (refer
note 20 'Financial risk management').
Note 12. Trade and other receivables
97 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
2021
$'000
2020
$'000
Current assets
Inventory 884 -
Amounts recognised in prot or loss
Inventory recognised as an expense during the year ended 30 June 2021 amounted to $8,176,000 (2020: $0). These were
Accounting policy
Inventory is valued at the lower of cost and net realisable value. Net realisable value is the estimated selling price in the
ordinary course of business, less estimated costs necessary to make the sale.
Inventory represents gift cards for a loyalty program in the US market.
sold is recognised as the expense of the value of inventory sold.
Note 13. Inventory
98 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
the case where the Group holds between 20% and 50% of the voting rights. Investments in associates are accounted for
using the equity method of accounting.
These assets were acquired as part of the T&T acquisition.
The following table presents the Group's investments accounted for using the equity method at 30 June 2021:
Name of company Principal Activity
Ownership
Interest
2021
%
Ownership
Interest
2020
%
Investment
in associates
2021
$'000
Investment
in associates
2020
$'000
2120 Tower LLC (North America) Commercial real estate 37.78% - 2,849 -
MFG Riesen (Europe) Travel services 40.00% - - -
The MFG Riesen investment value has reduced to zero at 30 June 2021 after recognition of losses by the Group.
Accounting policy
income. Investments in associates are carried in the Consolidated Statement of Financial Position at cost plus post-
acquisition changes in the Group's share of net assets of the associate. Goodwill relating to the associate is included in the
carrying amount of the investment and is neither amortised nor individually tested for impairment. Dividends received or
receivable from associates reduce the carrying amount of the investment.
When the Group's share of losses in an associate equals or exceeds its interest in the associate, including any unsecured
long-term receivables, the Group does not recognise further losses, unless it has incurred obligations or made payments
on behalf of the associate.
recognises any retained investment at its fair value. Any difference between the associate's carrying amount, fair value of
Note 14. Investments accounted for using the equity method
99 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
nor joint control. This is generally the case where the Group holds less than 20% share capital. These investments are
These assets were acquired as part of the T&T acquisition.
2021
$'000
2020
$'000
Minority interest investments 4,423 -
Refer to note 27 'Fair value measurement' for further information on fair value measurement.
Note 15. Financial assets at fair value through prot or loss
100 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
2021
$'000
2020
$'000
Buildings - right-of-use 56,778 55,671
Accumulated depreciation (15,344) (8,843)
Accumulated impairment (908) -
Total right-of-use assets 40,526 46,828
2021
$'000
2020
$'000
Opening net book value 46,828 -
Recognition on application of AASB 16 - 50,893
Additions 1,340 6,056
Additions through business combinations (note 9) 15,079 1,213
Disposals (9,701) (2,667)
Depreciation - continuing operations (9,384) (9,257)
Depreciation - discontinuing operations (90) -
Impairment of assets (903) -
Exchange difference (2,643) 590
Closing net book value 40,526 46,828
2021
$'000
2020
$'000
Expense relating to short term leases (included in occupancy expenses) 4 1,029
Expense relating to leases of low-value assets that are not shown above as short term leases
(included in operating expenses)
426 420
Expense relating to variable lease payments not included in lease liabilities
(included in operating expenses)
563 193
Accounting policy
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which
comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the
commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in
the cost of inventory, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and
restoring the site or asset.
Extension and termination options are included in a number of building leases across the Group. These are used to
extension and termination options held are exercisable only by the Group and not by the respective lessors. Most extension
options have been included in the lease liabilities. Extension options are only included in the lease term if the lease
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful
life of the asset, whichever is the shorter.
The Group has elected not to recognise a right-of-use asset and corresponding lease liability for short term leases with terms
Note 16. Right-of-use Assets
101 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
2021
$'000
2020
$'000
Current liabilities
Trade payables
1
41,079 7,801
Client payables
1
119,048 52,443
Other payables and accruals 43,918
40,255
Acquisition payable 700 -
Total current trade and other payables 204,745 100,499
Non-current liabilities
Other payables and accruals 9,998 522
Total trade and other payables 214,743 101,021
1
Trade payables and client payables are non-interest bearing and are normally settled on terms ranging from 7 to 30 days.
Accounting policy
Client payables result from provision of travel services and products to clients. Trade payables result from other activities
required to provide those travel services, such as corporate services.
Other payables and accruals represent liabilities for goods and services received, amounts recognised as redundancy
payments and amounts owed to clients for refund. These amounts are unsecured and are paid within terms ranging from
7 to 30 days from recognition. They are recognised initially at their fair value and subsequently measured at amortised
cost using the effective interest method. Other payables and accruals also includes deferred revenue. Deferred revenue
($14.5 million) relates to incentive payments received from suppliers as upfront payments when entering into long-term
settled from previously acquired entities.
Note 17. Trade and other payables
102 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Borrowings
2021
$'000
2020
$'000
Total current borrowings - -
The Group maintains a revolving multi-currency syndicated bank loan facility (the 'Facility') which was established in August
2019. The facility expires on 31 August 2022 and had a total capacity of GBP £60,000,000 (AU $110,644,000) at 30 June 2021.
The facility's limit was reduced to GBP £60,000,000 from GBP £100,000,000 in June 2021. The reduction was made to align
with the Group's forecast liquidity requirements, and to reduce costs associated with carrying surplus debt capacity.
The facility is secured against the assets of certain members of the Group who also are guarantors under the facility.
The Group has remained in compliance with requirements under its bank facility throughout the period. The Group has
agreed a covenant waiver with its lenders as detailed in the FY20 annual report. The waiver was extended in January 2021
and now continues through until 31 December 2021 with no further restriction. This waiver was granted with conditions
based on 1H22 performance.
Bank guarantees/letters of credit
state travel agency licensing and International Air Transport Association (IATA) regulations. The table below shows the
outstanding balance of guarantees issued by the Group at 30 June:
2021
$'000
2020
$'000
Bank guarantees 19,595 54,349
Bank guarantees are used primarily for trade support for transactions with airlines in Greater China and European rail
companies. These mandatory bank guarantees represent a barrier to entry for competitors in these markets and provide a
cost advantage for the Group.
Finance costs
2021
$'000
2020
$'000
Bank loans 1,544 3,371
Interest on lease liabilities 1,539 1,813
1
184 4,436
Total nance costs 3,267 9,620
Accounting policy
Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured
at amortised cost, using the effective interest rate method. Establishment costs are capitalised and are amortised over the
defer settlement of the liability for at least 12 months after the reporting date.
Finance costs
This expense is recognised as interest accrues, using the effective interest method for bank loans and an incremental
expense over the relevant period using the effective interest rate, which is the rate that exactly discounts estimated future
Note 18. Borrowings
103 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
2021
$'000
2020
$'000
Current liabilities
Lease liabilities 9,193 8,672
Non-current liabilities
Lease liabilities 37,188 44,423
Total lease liability 46,381 53,095
Reconciliation of lease liabilities at 30 June 2021 was as follows:
2021
$'000
2020
$'000
Opening net book value 53,095 -
Recognition on application of AASB 16 - 55,723
Additions 1,477 6,056
Additions through business combinations (note 9) 15,391 1,213
Disposals (11,330) (2,783)
Repayment of principal element of lease liabilities (9,315) (7,745)
Exchange difference (2,937) 631
46,381 53,095
Accounting policy
A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present
value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the
lease or, if that rate cannot be readily determined, the Group's incremental borrowing rate. Lease payments comprise of
expected to be paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is
reasonably certain to occur, and any anticipated termination penalties. The variable lease payments that do not depend on
an index or a rate are expensed in the period in which they are incurred.
Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are remeasured
if there is a change in the following: future lease payments arising from a change in an index or a rate used; residual
guarantee; lease term; certainty of a purchase option and termination penalties. When a lease liability is remeasured, an
asset is fully written down.
Note 19. Lease liabilities
104 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
The Group is exposed to market risk (interest rate risk and foreign exchange risk), credit risk, and liquidity risk in the normal
the Group’s operating units and in accordance with the Board approved Treasury Policy. The Treasury Policy provides
investment of excess liquidity.
(a) Market risk
Interest rate risk
interest bearing assets and liabilities.
The Group’s main interest rate exposure during the period arose from interest receivable on cash deposited with banks.
As at 30 June 2021, the Group had no outstanding variable rate borrowings (refer note 18 'Borrowings').
Interest rate risk is managed using natural hedges, borrowing terms available under facility documents or using interest
rate derivatives. As at the balance date, the Group had no interest rate derivatives outstanding. The Group has considered
Foreign exchange risk
The Group operates internationally and is exposed to foreign exchange risk. Foreign exchange risk arises from future
transactions and recognised assets and liabilities denominated in a currency that is not the functional currency of the
relevant Group entity.
The Group uses foreign exchange spot and forward contracts to manage its net risk position. At times, the Group also uses
its multi-currency debt facility allowing for borrowings in relevant currencies to provide an offset to revaluation of foreign
currency assets or future foreign currency earnings.
The Group’s exposure to foreign currency risk at the end of the reporting period, expressed in Australian dollars, was as follows.
2021
Cash
and cash
equivalents
$'000
Trade
and other
receivables
$'000
Related party
loans
$'000
Trade
and other
payables
$'000
Borrowings
$'000
Total
$'000
USD 754 152 2,598 (99) - 3,405
EUR 134 8 (2,273) 14 - (2,117)
HKD 78 1 (2,116) (3) - (2,040)
GBP 2,031 - 3 (19) - 2,015
SGD 1,530 - - (22) - 1,508
NZD 6 - 1,046 (1) - 1,051
Other 302 173 415 (82) - 808
Total foreign exchange risk 4,835 334 (327) (212) - 4,630
Based on the 30 June 2021 balances, a 10% stronger and 10% weaker Australian dollar against the currencies held, would
result in a gain of $514,000 and a loss of $421,000 respectively.
Note 20. Financial Risk Management
105 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
2020
Cash
and cash
equivalents
$'000
Trade
and other
receivables
$'000
Related party
loans
$'000
Trade
and other
payables
$'000
Borrowings
$'000
Total
$'000
USD 9,759 16 (59,440) (8) - (49,673)
HKD 2,046 52 22,642 (499) - 24,241
GBP 7,504 6 (25,884) (43) - (18,417)
NZD 3 15 1,397 - - 1,415
EUR 304 13 884 (20) - 1,181
CHF 133 - 921 (1) - 1,053
Other 964 339 1,266 (304) - 2,265
Total foreign exchange risk 20,713 441 (58,214) (875) (37,935)
Based on the 30 June 2020 balances, a 10% stronger and 10% weaker Australian dollar against the currencies held, would
result in a loss of $3,449,000 and a loss of $4,215,000 respectively.
(b) Credit risk
Credit risk arises from cash and cash equivalents placed on deposit with counterparties and balances owing from
clients and suppliers.
The Group’s exposure to credit risk relating to cash and cash equivalents arises from the ability of the counterparty to
repay funds placed on deposit. The Group’s cash and cash equivalent investments are held on deposit with counterparties
holding an investment grade credit rating.
and subsequent risk limits, which are set for each individual client in accordance with the Group’s policies. For some
client receivables, the Group may also obtain security in the form of deposits. In addition, receivable balances are actively
monitored on an ongoing basis, with the result that the Group’s exposure to bad debts has been historically negligible.
Trade and other receivables are subject to the expected credit loss model. The Group has applied the AASB 9 Financial
all receivables and contract assets.
Contract assets represent balances earned which are not yet unconditional and have the same characteristics as trade
receivables. The Group has, therefore, concluded that the expected loss rates for trade receivables are a reasonable
approximation of the loss rates for contract assets.
To measure the expected credit losses, receivables and contract assets have been grouped based on shared credit risk
characteristics (by client industry or supplier type) and the days past due. Based on the grouping of clients, an expected
individually assessed and allowed for. Historic loss events and forward-looking assumptions have been factored into the
expected loss allowance calculation for these assets as at 30 June 2021.
On this basis, the loss allowance as at 30 June 2021 and 30 June 2020 was determined as follows:
2021 Current
More than 30
days
past due
More than 60
days
past due
More than 90
days
past due Total
Expected loss rate (%) 1 7 10 62 3
Carrying amount – client receivables ($'000) 140,967 2,575 1,527 4,914 149,983
Carrying amount – trade receivables ($'000) 20,561 169 30 925 21,685
Carrying amount – contract assets ($'000) 3,674 - - - 3,674
Loss allowance ($'000) 1,811 181 163 3,627 5,782
Note 20. Financial risk management continued
106 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
2020 Current
More than 30
days
past due
More than 60
days
past due
More than 90
days
past due Total
Expected loss rate (%) 3 21 86 54 10
Carrying amount – client receivables ($'000) 25,983 4,092 227 5,816 36,118
Carrying amount – trade receivables ($'000) 14,823 1,053 98 125 16,099
Carrying amount – contract assets ($'000) 8,522 - - - 8,522
Loss allowance ($'000) 1,463 1,092 281 3,235 6,071
The loss allowances for receivables and contract assets as at 30 June reconcile to the opening loss allowances as follows:
Client
Receivables
$'000
Trade
Receivables
$'000
Contract
Assets
$'000
Opening loss allowance as at 1 July 2020 3,874 1,437 760
Increase/(decrease) in loss allowances recognised in the Consolidated Statement
33 (135) (281)
Receivables written off during the year as uncollectible (1,791) - (221)
Additions through acquisitions 2,102 4 -
Closing loss allowance as at 30 June 2021 4,218 1,306 258
Client
Receivables
$'000
Trade
Receivables
$'000
Contract
Assets
$'000
Opening loss allowance as at 1 July 2019 2,102 - -
and Other Comprehensive Income
2,989 1,437 760
Receivables written off during the year as uncollectible (1,217) - -
Closing loss allowance as at 30 June 2020 3,874 1,437 760
Receivables and contract assets are written-off where there is no reasonable expectation of recovery. Indicators that
there is no reasonable expectation of recovery include, amongst others, the failure of a client or supplier to engage
in a repayment plan.
Losses on client and trade receivables and contract assets are presented as bad and doubtful debts for client receivables
and transactional overrides or a write-back of revenue for volume-based overrides. Subsequent recoveries will be
recognised against the same line items.
(c) Liquidity risk
its liabilities when due, under both normal and stressed conditions.
In addition to the cash position outlined in note 11 'Cash and cash equivalents', the Group had the following credit facilities
available at 30 June 2021. Bank loan amounts include the Group‘s £60,000,000 (AUD $110,664,000) multi-currency revolving
loan facility which matures in August 2022, and overdraft facilities. Note that the Facility's total limit was reduced to GBP
£60,000,000 from GBP £100,000,000 in June 2021. The reduction was made to align with the Group's forecast liquidity
requirements, and to reduce costs associated with carrying surplus debt capacity.
Note 20. Financial risk management continued
107 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
2021
$'000
2020
$'000
Bank loans
Used - -
Unused 110,664 179,630
Total bank loans available 110,664 179,630
Credit cards
Used 15,990 10,098
Unused 60,672 88,238
Total credit cards limit 76,662 98,336
Overdraft facilities
Used - -
Unused 8,841 17,069
Total overdraft facilities available 8,841 17,069
The Group's credit card facilities are primarily used for client bookings via virtual credit cards.
Contractual
maturities of
nancial liabilities
Less than
6 months
$'000
6 - 12
months
$'000
Between
1 and 2 years
$'000
Between
2 and 5
years
$'000
Over
5 years
$'000
Total
contractual
$'000
Carrying
amount
(assets)/
liabilities
$'000
June 2021
Trade and other payables 197,078 7,630 2,931 7,104 - 214,743 214,743
Lease liabilities 5,423 5,090 9,043 19,054 12,352 50,962 46,381
Total non-derivative
nancial liabilities
202,501 12,720 11,974 26,158 12,352 265,705 261,124
June 2020
Trade and other payables 87,386 13,113 91 391 40 101,021 101,021
Lease liabilities 5,170 5,036 9,596 22,522 16,954 59,278 53,095
Total non-derivative nancial
liabilities
92,556 18,149 9,687 22,913 16,994 160,299 154,116
Note 20. Financial risk management continued
108 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Movements in provisions
Employee
entitlements
$’000
Provisions
for other
liabilities and
charges
$’000
Total
$’000
At 1 July 2020 5,825 33,394 39,219
Acquisition of subsidiaries 1,285 1,497 2,782
Disposal of subsidiaries (24) (35) (59)
Arising during the year 6,020 76,960 82,980
Utilised (4,741) (92,221) (96,962)
Write back of provision (837) (2,690) (3,527)
Transfer to acquisition payable - (700) (700)
Exchange differences (224) (1,742) (1,966)
At 30 June 2021 7,304 14,463 21,767
At 1 July 2019 8,882 24,096 32,978
Acquisition of subsidiary - 19,157 19,157
Arising during the year 7,772 235,382 243,154
Utilised (9,790) (219,742) (229,532)
Write back of provision (974) (25,131) (26,105)
Exchange differences (65) (368) (433)
At 30 June 2020 5,825 33,394 39,219
2021
Current 6,517 11,638 18,155
Non-current 787 2,825 3,612
7,304 14,463 21,767
2020
Current 4,001 29,825 33,826
Non-current 1,824 3,569 5,393
5,825 33,394 39,219
Accounting policy
Provisions are recognised when the Group has a present legal or constructive obligation as a result of a past event,
and a reliable estimate can be made of the amount of the obligation. At the end of the reporting period, provisions
are measured at the present value of management's best estimate of the expenditure required to settle the present
passage of time is recognised as interest expense.
Where the Group expects some or all of a provision to be reimbursed, for example under an insurance contract, the
reimbursement is recognised as a separate asset, but only when the reimbursement is virtually certain. The expense
Income, net of any reimbursement.
Note 21. Provisions
109 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
Employee benets
Short term employee benets
Liabilities for wages and salaries including non-monetary
the reporting period, are recognised in other payables
and accruals in respect of employees’ services up to
the reporting date. Liabilities for annual leave and
accumulated sick leave, expected to be settled within
12 months of the reporting period, are recognised in the
services up to the reporting date. They are measured
at the amounts expected to be paid when the liabilities
are settled. Liabilities for non-accumulated sick leave are
recognised when the leave is taken and are measured at
the rates paid or payable.
Other long-term employee benets
Liabilities for long service leave are recognised in the
the present value of expected future payments to be
made in respect of services provided by the employees
up to the reporting date, using the projected unit
credit method. Consideration is given to the expected
future wage and salary levels, experience of employee
departures, and periods of service. Expected future
payments are discounted using market yields at the
reporting date on government bonds, with terms
to maturity and currencies that match, as closely as
The obligations are presented as current liabilities
in the Consolidated Statement of Financial Position
if the entity does not have an unconditional right
to defer settlement for at least twelve months after
the reporting period, regardless of when the actual
settlement is expected to occur.
Retirement benet obligations
recognised as an expense as they become payable.
Prepaid contributions are recognised as an asset to
the extent that a cash refund or reduction in the future
payments are available.
Bonus plans
The Group recognises a provision for future bonus
payments where it is contractually obliged or where there is
a past practice that has created a constructive obligation.
Provision for other liabilities and charges
Provision for unclaimed charges
The Group recognises a provision for unclaimed charges,
arising from the sale of travel services. Based on historical
data and past experience, management considers the
possibility of claims and, if appropriate, it is written back
Comprehensive Income.
Note 21. Provisions continued
110 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
2021
$'000
2020
$'000
Ordinary shares - fully paid 744,581 375,314
Ordinary shares entitle the holder to receive dividends as declared and, in the event of winding up the Group, to participate
in the proceeds from the sale of all surplus assets in proportion to the number of, and amounts paid up on, shares held.
On a show of hands, every holder of ordinary shares present at a meeting, in person or by proxy, is entitled to one vote and
upon a poll each share is entitled to one vote.
Ordinary shares have no par value and the company does not have a limited amount of
authorised capital.
Movements in ordinary share capital
Details Date
Number
of shares $'000
Balance
1 July 2019 108,491,948
364,368
Share appreciation rights issue
21 August 2019 386,762
8,447
Initial consideration for the Corporate Travel Planners
Inc. business combination
21 February 2020 122,240
2,506
Less: transaction costs arising on share issue (10)
Deferred tax credit recognised directly in equity 3
Balance
30 June 2020 109,000,950
375,314
Capital raising used primarily for the acquisition of T&T
October 2020 27,055,823
374,723
T&T management share issue
6 November 2020 368,743
5,107
Less: transaction costs arising on share issue (11,115)
Deferred tax credit recognised directly in equity 552
Balance
30 June 2021 136,425,516
744,581
Accounting policy
shown in equity as a deduction, net of tax, from the proceeds.
Capital management
The Group maintains a conservative funding structure that allows it to meet its operational and regulatory requirements,
The Group’s optimal capital structure includes a mix of debt (refer note 18 'Borrowings'), cash (refer note 11 'Cash and cash
equivalents') and equity attributable to the parent’s equity holders.
When determining dividend returns to shareholders the Board considers a number of factors, including the Group’s
anticipated cash requirements to fund its growth, operational plan, and current and future economic conditions. There
were no dividends paid, recommended or determined during, or for, the current reporting period.
Note 22. Contributed equity
111 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
The following table shows a breakdown of the ‘reserves’ line item as per the Consolidated Statement of Financial Position,
and the movements in these reserves during the year. A description of the nature and purpose of each reserve is provided
in the following table.
Foreign
currency
translation
$’000
Share-based
payments
$’000
Total
$’000
At 30 June 2019 42,221 (15,220) 27,001
Currency translation differences 6,464 - 6,464
Deferred tax (722) - (722)
Other comprehensive income 5,742 - 5,742
Share-based payments:
Expense for the year - (4,160) (4,160)
Issuance of shares on vesting - (8,447) (8,447)
Effect of tax - 38 38
At 30 June 2020 47,963 (27,789) 20,174
Currency translation differences (28,765) - (28,765)
Deferred tax 1,811 - 1,811
Other comprehensive loss (26,954) - (26,954)
Share-based payments:
Expense for the year - 5,548 5,548
Issuance of shares on vesting - - -
Effect of tax - 4,716 4,716
At 30 June 2021 21,009 (17,525) 3,484
Nature and purpose of reserves
Foreign currency translation
Exchange differences arising on translation of foreign controlled entities are recognised in other comprehensive income
and accumulated in a separate reserve within equity. The cumulative amount is recognised in the Consolidated Statement
Share-based payments
The share-based payments reserve is used to recognise an expense for the grant date fair value of deferred shares granted
to employees but not yet vested over the vesting period, as well as deferred tax associated with future tax deductions.
Upon vesting of shares, the fair value of the shares issued is recognised in share capital (refer note 22 'Contributed equity')
and a corresponding entry recognised in the share-based payment reserve.
Note 23. Reserves
112 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
2021
$'000
2020
$'000
143,345 177,190
Adjustment for change in accounting policy - (1,707)
143,345 175,483
(55,351) (8,185)
Dividends paid (note 7) - (23,953)
Retained earnings at the end of the nancial year 87,994 143,345
Note 24. Retained earnings
113 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
2021
$'000
2020
$'000
The carrying amount of goodwill to the cash generating unit:
Australia and New Zealand 56,081 54,874
North America 402,668 208,004
Asia 49,744 54,132
Europe 169,760 140,090
Corporate Travel Planners (CTP) - 21,111
Total goodwill 678,253 478,211
The recoverable amount of each cash-generating unit ('CGU') has been determined based on probability-weighted
scenarios of future economic conditions, with the value-in-use ('VIU') basis being used for all valuations. A total of three
different scenarios were considered, each scenario modelling recovery path projections through to FY24. Each of the
scenarios were translated into probable outcomes for the respective CGU, with the probabilities based on external research
were used to determine the probability of each of the scenarios occurring. These externally determined probabilities were
for each CGU to be used in the assessment of its recoverable amount.
Corporate Travel Planners has been fully integrated into the North America CGU in FY21.
The three economic scenarios considered most probable as a result of the research, in order of weighting, were as follows:
1. COVID-19 recurs, long-term economic growth is slowed with a muted world recovery;
2.
extended period; and
3. COVID-19 is contained in a reasonable amount of time, and growth returns to trend historic growth over the
medium term.
The following table sets out the remaining key assumptions for those cash-generating units that have goodwill
allocated to them.
ANZ NA Asia Europe
2021
13.07% 11.69% 10.63% 11.22%
nominal growth rate of:
Revenue 3.50% 3.50% 3.50% 3.50%
Operating expenses 3.00% 3.00% 3.00% 3.00%
Long-term growth rate 2.00% 2.00% 2.00% 2.00%
2020
13.25% 12.58% 11.69% 10.99%
nominal growth rate of:
Revenue 3.50% 3.43% 3.50% 3.00%
Operating expenses 3.00% 3.00% 3.00% 2.00%
Long-term growth rate 2.00% 2.00% 2.00% 2.00%
Note 25. Impairment testing of goodwill
114 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
The following key assumptions were used in the modelling:
Recovery path projections through to FY24.
countries in which they operate.
Revenue - the basis used to determine the amount assigned to sales volume is based on historical experience,
expected client retentions and wins, and adjusted for growth and other known circumstances. This information was
overlayed to create three revenue scenarios based on the economic recovery paths.
Operating expenses - the basis used to determine the amount assigned to the forecast costs are based on historical
margins and patterns of revenue, adjusted for growth and other known circumstances.
which the cash-generating units operate.
Sensitivity to changes in key assumptions
Management recognises that there are various reasons the estimates used in these assumptions may vary. For each CGU,
changes in key assumptions could cause the carrying value of the CGU to exceed its recoverable amount.
All cash-generating units have been affected by the closure of borders, both domestic and international, caused by the
possible impacts of border closures, persistent border closures over long periods of time could cause the recoverable
amount of cash generating units to fall below their carrying values.
Accounting policy
annually for impairment, or more frequently if events or changes in circumstances indicate that they might be
impaired. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its
recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and its value
of the impairment at the end of each reporting period.
Note 25. Impairment testing of goodwill continued
115 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
Furniture,
equipment
$’000
Computer
equipment
$’000
Leasehold
improve-
ments
$’000
Other
$’000
Total
$’000
Year ended 30 June 2021
Cost 6,790 18,684 9,244 1,165 35,883
Accumulated depreciation (5,083) (14,423) (4,765) (457) (24,728)
1,707 4,261 4,479 708 11,155
Opening net book amount 2,250 3,353 5,514 974 12,091
Additions 84 209 472 - 765
Additions through business combinations (note 9) 343 3,934 1,325 - 5,602
Disposals (267) (59) (1,095) (74) (1,495)
Depreciation charge - continuing operations (774) (2,365) (1,389) (192) (4,720)
Depreciation charge - discontinued operations (30) (6) - - (36)
Exchange differences 101 (805) (348) - (1,052)
Closing net book amount 1,707 4,261 4,479 708 11,155
Year ended 30 June 2020
Cost 7,376 15,727 9,224 1,325 33,652
Accumulated depreciation (5,126) (12,374) (3,710) (351) (21,561)
2,250 3,353 5,514 974 12,091
Opening net book amount 2,833 2,871 6,441 1,183 13,328
Additions 208 1,997 415 50 2,670
Additions through business combinations 46 - - - 46
Disposals (346) (1,037) (628) (153) (2,164)
Depreciation charge (710) (1,526) (1,371) (234) (3,841)
Exchange differences 219 1,048 657 128 2,052
Closing net book amount 2,250 3,353 5,514 974 12,091
Accounting policy
Property, plant and equipment is stated at historical cost less accumulated depreciation and any accumulated impairment
losses. Historical cost includes expenditure that is directly attributable to the acquisition of the item. All other repairs
Comprehensive Income during the reporting period in which they are incurred.
Derecognition
expected to arise from the continued use of the asset.
Any gain or loss arising on derecognition of the asset, calculated as the difference between the net disposal proceeds and
Income in the year the asset is derecognised.
Note 26. Property, plant and equipment
116 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Depreciation expense
Depreciation is calculated on property, plant and equipment using the following estimated useful lives and methods:
Item
Years
Method
Leasehold improvements 3-15 Straight line
Computer equipment 3-5 Straight line
4-10 Straight line
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each
Note 26. Property, plant and equipment continued
117 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
Fair value hierarchy
30 June 2021 on a recurring basis.
At 30 June 2021
Level 1
$,000
Level 2
$,000
Level 3
$,000
Total
$,000
- - 4,423 4,423
At 30 June 2020
Level 1
$,000
Level 2
$,000
Level 3
$,000
Total
$,000
- - - -
Level 1:
assets and liabilities held by the Group is the closing bid or ask price as appropriate. These instruments are included in level 1.
Level 2:
derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little
instrument is included in level 2.
Level 3:
This is the case for unlisted equity securities.
Accounting policy for fair value measurement
fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date; and assumes that the transaction will take place either: in the
principal market; or in the absence of a principal market, in the most advantageous market.
Fair value is measured using the assumptions that market participants would use when pricing the asset or liability,
data are available to measure fair value, are used, maximising the use of relevant observable inputs and minimising
the use of unobservable inputs.
date and transfers between levels are determined based on a reassessment of the lowest level of input that is
For recurring and non-recurring fair value measurements, external valuers may be used when internal expertise is either
where applicable, with external sources of data.
Note 27. Fair value measurement
118 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Note 28. Share-based payments
Share appreciation rights
In 2020 CTM introduced a new Omnibus Incentive Plan
(Incentive Plan). The Incentive Plan replaced CTM’s
Share Appreciation Rights Plan (SARs Plan) and Exempt
Employee Share Plan. The Incentive Plan enables CTM
to offer a range of different awards, including share
appreciation rights (SARs), options, performance rights and
tax exempt shares. The grant of awards under the Incentive
Plan forms an integral part of effectively rewarding
executive management, and serves a number of positive
purposes, including acting as a retention tool for key
employees as well as linking the award of management
incentives to shareholder value creation and aligning the
interests of senior executives with those of shareholders to
encourage the long-term sustainable growth of the CTM.
SARs under the current framework
In FY21, performance SARs (Performance SARs) and
retention SARs (Retention SARs) were awarded under
the Incentive Plan. Participation in the Incentive Plan is
at the Board’s absolute discretion and no individual has a
contractual right to participate in the plan or to receive any
Plan carry no dividend or voting rights.
Performance SARs only vest if certain performance
standards are met, the employee remains in service, and
upon the achievement of earnings per share growth
targets over a two year performance period. Vesting of
Retention SARs is subject to continuing employment for a
There is no consideration payable by the participant
upon exercising of vested SARs. The number of shares
to be issued upon vesting of Performance SARs
and Retention SARs is calculated by reference to an
increase in the price of CTM’s shares from a base
price determined by the Board and the 5 day volume
weighted average price of CTM’s shares immediately
preceding the date that the Board determines that the
Further details can be found in the Remuneration Report.
SARs under the legacy framework
SARs grants made in 2018 and 2019 only vest if certain
performance standards are met, the employee remains
in service and the achievement of an earnings per share
growth target over a three year performance period.
The EPS growth test has performance conditions on a
scaled basis as follows:
50% qualify at 80% target achievement;
75% qualify at 90% target achievement; and
100% qualify at 100% target achievement.
SARs granted under the SARs Plan carry no dividend or
voting rights. There is no consideration payable by the
participant upon exercising of vested SARs.
The following table summarises the movement in SARs granted under the plan:
Grant date
2021
Number of SARs
2020
Number of SARs
As at 1 July 3,489,000 3,868,500
Granted during the year 3,504,250 1,698,000
Exercised during the year - (1,297,500)
Forfeited during the year (1,178,500) (780,000)
As at 30 June 5,814,750 3,489,000
Vested and exercisable at 30 June - -
No SARs issued during the periods above expired during those periods.
SARs outstanding at the end of the year have the following performance period and share base prices:
Grant date Performance period Base price
2021
Number of SARs
2020
Number of SARs
22 August 2017 1 July 2017 – 30 June 2020 $23.90 - 983,000
22 August 2018 1 July 2018 – 30 June 2021 $29.00 1,101,500 1,113,000
9 September 2019 1 July 2019 – 30 June 2022 $22.84 1,311,500 1,393,000
18 August 2020 1 July 2020 – 30 June 2021 $9.89 809,750 -
18 August 2020 1 July 2020 – 30 June 2022 $9.89 1,574,500 -
1 November 2020 1 November 2020 - 30 June 2022 $12.35 917,500 -
30 April 2021 1 July 2021 - 30 June 2024 $13.85 100,000 -
5,814,750 3,489,000
No SARs vested during the period. 3,504,250 SARs were granted during FY21, pursuant to the CTM SARs Incentive Plan.
119 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
Fair value of SARs granted
The assessed weighted average fair value at grant date of the SARs granted during the year ended 30 June 2021 was $3.15
per SAR (2020: $1.67). The fair value at grant date was determined using the Black-Scholes pricing model that takes into
account the share price at the time of the grant, the exercise price, the term of the SAR, the expected dividend yield, the
expected price volatility of the underlying share and the risk free interest rate for the term of the SAR.
The fair value model inputs for SARs granted during the year ended 30 June 2021 included:
Base price Grant date Vesting date
Share
price at
grant date
Expected
price
volatility
of CTM's
shares
Expected
dividend
yield
Risk-free
interest
rate
$ $ % % %
SARs are granted for no
consideration and vest
based on employees
being employed at CTM
on 30 June 2021
9.89 18 August 2020 1 July 2021 11.61 31.20% - 0.25%
SARs are granted for no
consideration and vest
based on the Group's
Earnings per Share
growth over a 2 year
vesting period
9.89 18 August 2020 1 July 2022 11.61 31.20% 1.00% 0.25%
SARs are granted for no
consideration and vest
based on the Group's
Earnings per Share
growth over a 2 year
vesting period
12.35 1 November 2020 1 July 2022 14.77 32.30% 1.00% 0.25%
SARs are granted for no
consideration and vest
based on the employee
being employed at CTM
on 30 June 2021
9.89 18 August 2020
1
1 July 2021 17.02 32.30% - 0.25%
SARs are granted for no
consideration and vest
based on the Group's
Earnings per Share
growth over a 2 year
vesting period
9.89 18 August 2020
1
1 July 2022 17.02 32.30% 1.00% 0.25%
SARs are granted for no
consideration and vest
based on the Group's
Earnings per Share
growth over a 3 year
vesting period
13.85 30 April 2021 1 July 2024 18.45 32.30% 1.00% 0.25%
The expected price volatility is based on the historic volatility, and on the remaining life of the SARs, adjusted for any
expected changes to future volatility due to publicly available information.
Note 28. Share-based payments continued
27 October 2020.
120
CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Expenses arising from SARs
An expense for the year of $5,548,000 has been recognised
comprehensive income with a corresponding amount
recognised in the share based payment reserve (refer to
note 23 'Reserves'). The expense recognised is based on the
number of SARs issued in FY21 that are expected to vest.
For SARs issued prior to FY21, it was determined in FY20 that
none of the unvested SARs were expected to vest resulting
in the reversal of previously recognised expenses (2020: net
credit of $4,160,000 recognised). The probability of vesting
remains unchanged following a reassessment in FY21.
Accounting policy
to employees by way of a Share Appreciation Right
(SAR). The fair value of SARs granted is recognised as
increase in equity. The total amount to be expensed is
determined by reference to the fair value of the rights
granted, which includes any market performance
conditions and the impact of any service and non-
market performance vesting conditions.
Non-market vesting conditions are included in
assumptions about the number of SARs that are expected
to vest. The total expense is recognised over the vesting
period, CTM revises its estimates of the number of SARs
that are expected to vest based on the non-market
vesting conditions. CTM recognises the impact of the
corresponding adjustment to equity.
Note 28. Share-based payments continued
121 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
(a) Subsidiary entities
The Group’s subsidiary entities at 30 June 2021 are set out in the following table. Unless otherwise stated, each entity
has share capital consisting solely of ordinary shares that are held by the Group, and the proportion of ownership interests
held equals the voting rights held by the Group. The country of incorporation or registration is also their principal
place of business.
Company Region Country
Ownership
2021
%
Ownership
2020
%
Corporate Travel Management Group Pty Ltd
5
ANZ Australia 100.00% 100.00%
Floron Nominees Pty Ltd
5
ANZ Australia 100.00% 100.00%
WA Travel Management Pty Ltd
5
ANZ Australia 100.00% 100.00%
Sainten Pty Ltd
5
ANZ Australia 100.00% 100.00%
ETM Travel Pty Ltd
5
ANZ Australia 100.00% 100.00%
Travelcorp Holdings Pty Ltd
5
ANZ Australia 100.00% 100.00%
Travelogic Pty. Limited
5
ANZ Australia 100.00% 100.00%
Andrew Jones Travel Pty Ltd ANZ Australia 100.00% 100.00%
SCT Travel Group Pty Ltd ANZ Australia 100.00% 100.00%
Travelcorp (Aust) Pty Ltd
5
ANZ Australia 100.00% 100.00%
Tramada Holdings Pty Ltd
1
ANZ Australia 100.00% -
Tramada International Pty Ltd
1
ANZ Australia 100.00% -
Tramada Systems Pty Ltd
1
ANZ Australia 100.00% -
Corporate Travel Management (New Zealand) Limited ANZ New Zealand 100.00% 100.00%
Tramada Systems (UK) Limited
1
ANZ United Kingdom 100.00% -
Tramada Systems (USA) Inc
1
ANZ United States of America 100.00% -
CTMNA Holdings Limited North America United States of America 100.00% 100.00%
Corporate Travel Management North America Inc North America United States of America 100.00% 100.00%
Corporate Travel Planners, Inc North America United States of America 100.00% 100.00%
Travel & Transport, Inc
2
North America United States of America 100.00% -
Travefy Incorporated
2
North America United States of America 10.00% -
TTRE Inc
2
North America United States of America 100.00% -
TTINV Inc
2
North America United States of America 100.00% -
WTT Inc
2
North America United States of America 100.00% -
Data Vizualization Intelligence, Inc North America United States of America 100.00% -
2120 Tower LLC
2
North America United States of America 37.78% -
Corporate Travel Management (CAN) Limited North America Canada 100.00% 100.00%
Thayer Ventures III, L.P
2
North America United States of America 4.00% -
CTM Global Services (UK)
3
Europe United Kingdom - 100.00%
Corporate Travel Management (UK) Limited Europe United Kingdom 100.00% 100.00%
USD Treasury Coy (UK) Limited Europe United Kingdom 100.00% 100.00%
GBP Treasury Coy (UK) Limited
3
Europe United Kingdom - 100.00%
AUD Treasury Coy (UK) Limited
3
Europe United Kingdom - 100.00%
HKD Treasury Coy (UK) Limited
3
Europe United Kingdom - 100.00%
Corporate Travel Management (Europe) Limited Europe United Kingdom 100.00% 100.00%
Corporate Travel Management (North) Limited Europe United Kingdom 100.00% 100.00%
Portall Travel Limited Europe United Kingdom 100.00% 100.00%
Arizonaco Limited Europe United Kingdom 100.00% 100.00%
AIT Travel Limited Europe United Kingdom 100.00% 100.00%
Alpha-Omega (Travel) Limited Europe United Kingdom 100.00% 100.00%
Corporate Travel Management (United Kingdom) Ltd Europe United Kingdom 100.00% 100.00%
Note 29. Interest in other entities
122 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Note 29. Interest in other entities continued
Company Region Country
Ownership
2021
%
Ownership
2020
%
Radius Travel WTT Limited
2
Europe United Kingdom 100.00% -
Travel and Transport UK Limited
2
Europe United Kingdom 100.00% -
Statesman Travel Group Limited
2
Europe United Kingdom 100.00% -
Statesman Travel Management Limited
2
Europe United Kingdom 100.00% -
Statesman TMC Limited
2
Europe United Kingdom 100.00% -
Statesman Travel Limited
2
Europe United Kingdom 100.00% -
Statesman Travel (Leisure) Limited
2
Europe United Kingdom 100.00% -
Statesman Travel Services Limited
2
Europe United Kingdom 100.00% -
Statesman Travel Logistics Limited
2
Europe United Kingdom 100.00% -
SAS Corporate Travel Management (France) Europe France 100.00% 100.00%
Corporate Travel Management (Germany) GmbH Europe Germany 100.00% 100.00%
Corporate Travel Management (Netherlands) BV Europe Netherlands 100.00% 100.00%
Corporate Travel Management (Switzerland) GmbH Europe Switzerland 100.00% 100.00%
Corporate Travel Management (Sweden) AB Europe Sweden 100.00% 100.00%
Corporate Travel Management (Czech Republic) s.r.o Europe Czechoslovakia 100.00% 100.00%
Corporate Travel Management (Norway) AS Europe Norway 100.00% 100.00%
Corporate Travel Management (Denmark) Aps Europe Denmark 100.00% 100.00%
Corporate Travel Management (Hungary) Kft Europe Hungary 100.00% 100.00%
Corporate Travel Management (Poland) SP. z.o.o Europe Poland 100.00% 100.00%
MFG Riesen
2
Europe Germany 40.00% -
Travell inspector GmbH Schweiz
2
Europe Switzerland 40.00% -
Statesman Travel Services Private Limited
2
Europe India 99.99% -
Wealthy Aim Investments Limited Asia British Virgin Islands 75.10% 75.10%
Westminster Travel Limited Asia Hong Kong 75.10% 75.10%
Westminster Travel (China) Limited Asia Hong Kong 75.10% 75.10%
Jecking Tours & Travel Limited Asia Hong Kong 75.10% 75.10%
Far Extent Investments Limited Asia Hong Kong 75.10% 75.10%
Asia British Virgin Islands 75.10% 75.10%
Bees.Travel Limited Asia Hong Kong 75.10% 75.10%
Corporate Travel Management Limited Asia Hong Kong 75.10% 75.10%
CTM Overseas Education Centre Limited Asia Hong Kong 75.10% 75.10%
Lotus Travel Group Limited Asia British Virgin Islands 75.10% 75.10%
Lotus Tours Limited Asia Hong Kong 75.10% 75.10%
Travel Resources Limited
4
Asia Hong Kong - 75.10%
Memory Holidays Limited Asia Hong Kong 75.10% 75.10%
Westminster Travel (S) Pte. Ltd. Asia Singapore 75.10% 75.10%
Westminster Travel Limited (Taiwan) Asia Taiwan 75.10% 75.10%
Lotus Tours Taiwan Co Ltd (Taiwan)
3
Asia Taiwan - 75.10%
Westminster Travel Limited (Macau) Asia Macau 75.10% 75.10%
Beijing Westminster Air Service Limited
3
Asia People's Republic of China - 75.10%
Westminster Travel Consultancy (Guangzhou) Limited Asia People's Republic of China 75.10% 75.10%
Guangzhou Anlv Travel Service Co Ltd Asia People's Republic of China 75.10% 75.10%
1
On 29 October 2020, CTM acquired 100% of the shares of Tramada Holdings Pty Ltd, including all of its subsidiary entities.
2
On 30 October 2020, CTM acquired 100% of the shares of Travel and Transport, Inc., including all of its subsidiary entities.
3
Entities deregistered during the year.
4
Entity disposed of during the year.
5
Australian Securities and Investments Commission. For further information refer note 32 'Deed of cross guarantee'.
123
ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
(b) Non-controlling interests ('NCI')
material to the Group.
The amounts disclosed are before inter-company eliminations.
2021
$'000
2020
$'000
Summarised Statement of Financial Position
Current assets 71,549 123,296
Current liabilities (25,763) (60,815)
Current net assets 45,786 62,481
Non-current assets 66,687 77,827
Non-current liabilities (11,706) (20,679)
Non-current net assets 54,981 57,148
Net assets 100,767 119,629
Accumulated NCI of the subsidiary 15,398 19,254
Summarised Statement of Prot or Loss and Other Comprehensive Income
Revenue and other income 18,238 53,124
Loss for the year (9,581) (9,334)
Other comprehensive income/(loss) for the year (9,840) 4,088
Total other comprehensive loss for the year (19,421) (5,246)
Loss for the year allocated to NCI (2,410) (2,439)
Dividends paid to NCI - 2,503
Summarised Statement of Cash Flows
(29,097) 27,161
(1,704) (2,091)
56,359 (42,600)
Net increase/(decrease) in cash and cash equivalents 25,558 (17,530)
Note 29. Interest in other entities continued
124 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
(a) Parent entities
The ultimate parent entity within the Group is Corporate Travel Management Limited.
(b) Subsidiary entities
Interests in subsidiary entities are set out in note 29 'Interest in other entities'.
(c) Key management personnel compensation
2021
$'000
2020
$'000
Short term 3,866 3,947
Post-employment 132 135
112 (81)
Share-based payments 1,956 (1,379)
Total KMP compensation 6,066 2,622
Detailed remuneration disclosures are provided in the Remuneration Report.
(d) Transactions with other related parties
Detailed remuneration disclosures are provided in the Remuneration Report.
(e) Outstanding balances with related parties
The following balances are outstanding at the end of the reporting period in relation to transactions with related parties.
2021
$'000
2020
$'000
Contingent consideration
Key management personnel
1
1,293 1,939
1
The balance represents the present value of the contingent consideration to Greg McCarthy, as a part of the acquisition of SCT Travel Group Pty Ltd,
trading as Platinum Travel Corporation.
(f) Terms and conditions
Directors of the Group hold other directorships as detailed in the Directors’ Report. Where any of these related entities are
clients of the Group, the arrangements are on normal commercial terms and conditions and at market rates.
Directors and executives can acquire travel and event management services on normal terms and conditions and at
market rates. There are no amounts outstanding in relation to these transactions at 30 June 2021.
Note 30. Related party transactions
125 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
Note 31. Parent entity information
(a) Summary nancial information
Statement of prot or loss and other comprehensive income
Parent
2021
$'000
Parent
2020
$'000
(26,264) 27,482
Total comprehensive income (26,264) 27,482
Statement of nancial position
Parent
2021
$'000
Parent
2020
$'000
Total current assets 2,359 24,032
Total assets 774,239 462,419
Total current liabilities 2,095 57,588
Total liabilities 17,121 57,990
Net assets 757,118 404,429
Equity
Contributed equity 764,984 395,717
Reserve (16,477) (26,164)
Retained earnings 8,611 34,876
Total equity 757,118 404,429
previously reported equity.
(b) Guarantees entered into by the parent entity
(c) Contingent liabilities of the parent entity
The parent entity did not have any contingent liabilities as at 30 June 2021 or 30 June 2020.
(d) Contractual commitments
The parent did not have any contractual commitments at 30 June 2021 or 30 June 2020.
126 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Note 31. Parent entity information continued
Accounting policy
Travel Management Limited, has been prepared on the
except as follows:
(i) Investments in subsidiaries
Investments in subsidiaries are accounted for at
Management Limited.
(ii) Tax consolidation legislation
Corporate Travel Management Limited and its wholly-
owned Australian controlled entities have implemented
entity, Corporate Travel Management Limited and the
controlled entities in the tax consolidated group account
for their own current and deferred tax amounts. These
tax amounts are measured as if each entity in the tax
consolidated group continues to be a stand-alone
taxpayer in its own right.
In addition to its own current and deferred tax
amounts, Corporate Travel Management Limited also
recognises the current tax liabilities or assets and the
deferred tax assets arising from unused tax losses and
unused tax credits assumed from controlled entities in
the tax consolidated group.
These entities have also entered into a tax funding
agreement under which the wholly-owned entities fully
compensate Corporate Travel Management Limited for
any current tax payable assumed and are compensated
by Corporate Travel Management Limited for any current
tax receivable and deferred tax assets relating to unused
tax losses or unused tax credits that are transferred to
Corporate Travel Management Limited under the tax
consolidation legislation. The funding amounts are
determined by reference to the amounts recognised in
The amounts receivable/payable under the tax
funding agreement are due upon receipt of the funding
advice from the head entity, which is issued as soon as
The head entity may also require payment of interim
funding amounts, to assist with its obligations to pay
tax instalments.
Assets or liabilities arising under tax funding agreements
with the tax consolidated entities are recognised as
current amounts receivable from or payable to other
entities in the Group. Any difference between the
amounts assumed and amounts receivable or payable
under the tax funding agreement are recognised as a
contribution to or distribution from wholly-owned tax
consolidated entities.
(iii) Financial guarantees
in relation to loans and payables of subsidiaries for no
compensation, the fair values of these guarantees are
accounted for in the parent company and consolidated
127 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
Note 32. Deed of cross guarantee
Corporate Travel Management Limited, Corporate Travel Management Group Pty Ltd, Floron Nominees Pty Ltd,
Sainten Pty Ltd, Travelogic Pty Limited, WA Travel Management Pty Ltd, Travelcorp Holdings Pty Ltd, Travelcorp (Aust)
Pty Ltd, ETM Travel Pty Ltd and Corporate Travel Management (New Zealand), CTMNA Holdings Limited, Corporate
Travel Management North America, Inc, are parties to a deed of cross guarantee, under which each company
guarantees the debts of the other companies.
By entering into the deed, the wholly owned Australian entities have been relieved from the requirement to prepare
and Investments Commission.
These companies represent a ‘closed group’ for the purposes of the Class Order and, as there are no other parties to
the deed of cross guarantee that are controlled by Corporate Travel Management Limited, they also represent the
‘extended closed group’.
of movements in consolidated retained earnings and Consolidated Statement of Financial Position for the year ended
30 June 2021 of the closed group.
Statement of prot or loss and other comprehensive income
2021
$'000
2020
$'000
Revenue 68,115 187,244
Other income 39,001 39,076
(67,872) (129,948)
Information technology and telecommunications (14,780) (23,268)
Occupancy (1,077) (1,392)
Travel and entertainment (237) (2,488)
Administrative and general (12,187) (12,482)
Depreciation and amortisation (19,710) (20,014)
Impairment - (2,659)
Operating prot/(loss) (8,747) 34,069
Finance costs (1,929) (9,782)
Prot/(loss) before income tax benet (10,676) 24,287
7,888 206
Prot/(loss) after income tax benet (2,788) 24,493
Other comprehensive income/(loss)
Exchange differences on translation of foreign operations
(25,790) 10,277
Other comprehensive income/(loss) for the year, net of tax
(25,790) 10,277
Total comprehensive income/(loss) for the year
(28,578) 34,770
Summary of movements in retained earnings
127,329 126,696
(2,788) 24,493
Dividends paid
- (23,860)
Retained earnings at the end of the nancial year
124,541 127,329
128 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Note 32. Deed of cross guarantee continued
Statement of nancial position
2021
$'000
2020
$'000
Current assets
Cash and cash equivalents 12,835 29,347
Trade and other receivables 45,719 23,645
Income tax receivable 6,647 9,625
Other assets 1,034 2,332
Total current assets 66,235 64,949
Non-current assets
Investments 596,921 301,043
Property, plant and equipment 3,693 5,412
Right-of-use assets 11,958 23,320
Intangible assets 261,104 275,073
Deferred tax assets 17,231 5,185
Related party receivables 12,960 31,254
Total non-current assets 903,867 641,287
Total assets 970,102 706,236
Current liabilities
Trade and other payables 49,955 39,770
Lease liabilities 2,650 4,484
Related Party 9,296 60,514
Provisions 2,757 3,732
Total current liabilities 64,658 108,500
Non-current liabilities
Lease liabilities 11,752 22,211
Related Party 34,341 55,287
Deferred tax liabilities - 10,537
Provisions 730 2,738
Total non-current liabilities 46,823 90,773
Total liabilities 111,481 199,273
Net assets 858,621 506,963
Equity
Contributed equity 744,581 375,314
Reserves (10,501) 4,320
Retained earnings 124,541 127,329
Total equity 858,621 506,963
129 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
Note 33. Auditors’ remuneration
The auditor of the Group is PricewaterhouseCoopers.
2021
$
2020
$
Audit services - PricewaterhouseCoopers
403,951 521,553
Other services - PricewaterhouseCoopers
Assurance services 5,000 5,000
Tax compliance services 110,795 115,000
Tax advisory services 177,160 146,711
Other advisory services 14,500 -
307,455 266,711
Total remuneration of PricewaterhouseCoopers Australia 711,406 788,264
Other PricewaterhouseCoopers network rms:
Other services in relation to the entity and any other entity in the consolidated group:
1,136,575 756,951
Other assurance services 43,750 18,369
Tax compliance services 6,623 1,074
Tax advisory services 50,242 63,458
Other advisory services - 1,407
Total remuneration of PricewaterhouseCoopers network rms 1,237,190 841,259
Services in relation to the entity and any other entity in the consolidated group:
46,307 50,125
Total remuneration of Non-PricewaterhouseCoopers rms 46,307 50,125
130 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Note 34. Summary of signicant accounting policies
(a) Basis of preparation
prepared in accordance with Australian Accounting
Standards and Interpretations issued by the Australian
Accounting Standards Board and the Corporations
Act 2001. Corporate Travel Management Limited is
prepared on a going concern basis.
Compliance with IFRS
comply with International Financial Reporting Standards
(IFRS) as issued by the International Accounting
Standards Board (IASB).
dollars and all values, where appropriate, rounded to the
nearest thousand dollars ($’000), unless otherwise stated.
and Other Comprehensive Income.
New standards and interpretations
Customisation in a Cloud Computing Arrangement
delivered in March 2021 has been reviewed and
determined to not have a material impact on CTM.
(b) Rounding of amounts
Amounts in the Consolidated Financial Statements are
presented in Australian Dollars with values rounded to the
nearest thousand dollars, or in certain circumstances, the
nearest dollar, in accordance with the Australian Securities
and Investments Commission Corporations (Rounding in
Financial/Directors' Report) Instrument 2016/191.
Critical accounting estimates
use of certain critical accounting estimates. It also requires
management to exercise its judgement in the process
of applying the Group's accounting policies. The areas
involving a higher degree of judgement or complexity, or
accounting judgements, estimates and assumptions'.
131 ANNUAL REPORT 2021
Notes to the Consolidated
Financial Statements
Note 34. Summary of signicant accounting policies continued
Associates
Associates are entities over which the Group has
Investments in associates are accounted for using the
equity method. Under the equity method, the share
equity is recognised in other comprehensive income.
Investments in associates are carried in the statement
changes in the Group's share of net assets of the
associate. Goodwill relating to the associate is included
in the carrying amount of the investment and is neither
amortised nor individually tested for impairment.
Dividends received or receivable from associates reduce
the carrying amount of the investment.
When the Group's share of losses in an associate equals
or exceeds its interest in the associate, including any
unsecured long-term receivables, the Group does not
recognise further losses, unless it has incurred obligations
or made payments on behalf of the associate.
The Group discontinues the use of the equity method
and recognises any retained investment at its fair value.
Any difference between the associate's carrying amount,
fair value of the retained investment and proceeds from
Investments and other nancial assets
measured at fair value. Transaction costs are included
subsequently measured at either amortised cost or fair
determined based on both the business model within
mismatch is being avoided.
Financial assets are derecognised when the rights to
and the Group has transferred substantially all the risks
and rewards of ownership. When there is no reasonable
carrying value is written off.
Financial assets at fair value through other
comprehensive income
Financial assets at fair value through other
comprehensive income include equity investments
which the Group intends to hold for the foreseeable
future and has irrevocably elected to classify them as
such upon initial recognition.
Impairment of nancial assets
The Group recognises a loss allowance for expected credit
amortised cost or fair value through other comprehensive
income. The measurement of the loss allowance depends
upon the Group's assessment at the end of each reporting
based on reasonable and supportable information that is
available, without undue cost or effort to obtain.
exposure to credit risk since initial recognition, a 12-month
expected credit loss allowance is estimated. This
represents a portion of the asset's lifetime expected credit
losses that is attributable to a default event that is possible
become credit impaired or where it is determined that
is based on the asset's lifetime expected credit losses. The
amount of expected credit loss recognised is measured
on the basis of the probability weighted present value of
anticipated cash shortfalls over the life of the instrument
discounted at the original effective interest rate.
through other comprehensive income, the loss allowance
is recognised in other comprehensive income with a
cases, the loss allowance reduces the asset's carrying value
132 CORPORATE TRAVEL MANAGEMENT
Notes to the Consolidated
Financial Statements
Note 35. Events after the reporting period
133 ANNUAL REPORT 2021
In the Directors' opinion:
Corporations Regulations 2001 and other mandatory professional reporting requirements;
there are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due
and payable; and
at the date of this declaration, there are reasonable grounds to believe that the members of the extended closed
group will be able to meet any obligations or liabilities to which they are, or may become, subject by virtue of the
The Directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of Directors made pursuant to section 295(5)(a) of the Corporations Act 2001.
On behalf of the Directors
Mr Ewen Crouch AM Mr Jamie Pherous
Chairman Managing Director
18 August 2021
Brisbane
30 June 2021
Directors'
Declaration
134 CORPORATE TRAVEL MANAGEMENT
Independent
Auditor's Report
To the members of Corporate Travel Management Limited Continued
PricewaterhouseCoopers, ABN 52 780 433 757
480 Queen Street, BRISBANE QLD 4000, GPO Box 150, BRISBANE QLD 4001
T: +61 7 3257 5000, F: +61 7 3257 5999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.
Independent auditor’s report
To the members of Corporate Travel Management Limited
Report on the audit of the financial report
Our opinion
In our opinion:
The accompanying financial report of Corporate Travel Management Limited (the Company) and its
controlled entities (together the Group) is in accordance with the Corporations Act 2001, including:
(a) giving a true and fair view of the Group's financial position as at 30 June 2021 and of its
financial performance for the year then ended
(b) complying with Australian Accounting Standards and the Corporations Regulations 2001.
What we have audited
The Group financial report comprises:
භ the consolidated statement of financial position as at 30 June 2021
භ the consolidated statement of changes in equity for the year then ended
භ the consolidated statement of cash flows for the year then ended
භ the consolidated statement of profit or loss and other comprehensive income for the year then
ended
භ the notes to the consolidated financial statements, which include significant accounting policies
and other explanatory information
භ the directors’ declaration.
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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Independence
We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (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.
135 ANNUAL REPORT 2021
Independent
Auditor's Report
To the members of Corporate Travel Management Limited Continued
Our audit approach
An audit is designed to provide reasonable assurance about whether the financial report is free from
material misstatement. Misstatements may arise due to fraud or error. They are considered material if
individually or in aggregate, they could reasonably be expected to influence the economic decisions of
users taken on the basis of the financial report.
We tailored the scope of our audit to ensure that we performed enough work to be able to give an
opinion on the financial report as a whole, taking into account the geographic and management
structure of the Group, its accounting processes and controls and the industry in which it operates.
The Group provides travel management solutions to the corporate market and operates in four broad
geographic regions, being Australia & New Zealand (“ANZ”), North America, Asia and Europe. The
regional finance functions report to the Group finance function in Brisbane, Australia where the
consolidation is performed.
Materiality
භ For the purpose of our audit we used overall Group materiality of $1.7 million, which represents
approximately 1% of the Group’s revenue.
භ We applied this threshold, together with qualitative considerations, to determine the scope of
our audit and the nature, timing and extent of our audit procedures and to evaluate the effect of
misstatements on the financial report as a whole.
භ We applied this threshold, together with qualitative considerations, to determine the scope of
our audit and the nature, timing and extent of our audit procedures and to evaluate the effect of
misstatements on the financial report as a whole. We chose Group revenue because it is
reflective of the Group’s operating activities during the year and provides a level of materiality
which, in our view, is appropriate for the audit having regard to the expected users of the Group
financial report.
භ We utilised a 1% threshold based on our professional judgement, noting it is within the range of
commonly acceptable thresholds.
136 CORPORATE TRAVEL MANAGEMENT
Independent
Auditor's Report
To the members of Corporate Travel Management Limited Continued
Audit Scope
භ Our audit focused on where the Group made subjective judgements; for example, significant
accounting estimates involving assumptions and inherently uncertain future events.
භ In establishing the overall approach to the Group audit, we determined the type of audit work
that needed to be performed by us, as the Group engagement team, and by component auditors
in the USA, Hong Kong and the UK operating under our instruction. We structured our audit as
follows:
о We performed audit procedures over the Australia & New Zealand region, in addition to
auditing the consolidation of the Group's regional reporting units into the Group's financial
report.
о Component auditors in the USA, Hong Kong and the UK performed audit procedures over
the North America, Asia and Europe regions respectively.
භ For the work performed by component auditors in the USA, Hong Kong and the UK, we
determined the level of involvement we needed to have in the audit work at these locations to be
satisfied that sufficient audit evidence had been obtained as a basis for our opinion on the
Group financial report as a whole. This included active dialogue throughout the year through
discussions, issuing written instructions, receiving formal interoffice reporting, as well as
attending meetings with local management.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report for the current period. The key audit matters were addressed in the
context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do
not provide a separate opinion on these matters. Further, any commentary on the outcomes of a
particular audit procedure is made in that context. We communicated the key audit matters to the
Audit and Risk Committee.
Key audit matter How our audit addressed the key audit
matter
Impairment assessment of the Group’s
goodwill
(Refer to note 25)
At 30 June 2021, the Group recorded $756.9m of
intangible assets, of which $678.3m related to
goodwill.
The goodwill is allocated to four cash generating units
(“CGUs”), being Australia & New Zealand, North
America, Europe and Asia.
As required by Australian Accounting Standards, at
30 June 2021 the Group performed an impairment
assessment over the goodwill balances by calculating
the recoverable amount for each CGU, using
Our procedures in relation to the impairment
assessment of goodwill included, amongst others:
භ Assessing the appropriateness of the Group’s
determination of its CGUs
භ Developing an understanding of the process
undertaken by the Group in the preparation
of the discounted cash flow models used to
assess the recoverable amount of the Group’s
CGUs (the “impairment models”)
භ Assessing the basis upon which the Group
developed the forecast scenarios, and the
probability weighting applied to each
137 ANNUAL REPORT 2021
Independent
Auditor's Report
To the members of Corporate Travel Management Limited Continued
Key audit matter How our audit addressed the key audit
matter
discounted cash flow models prepared on a ‘value in
use’ basis. The recoverable amount of each CGU was
determined by the Group based on three probability-
weighted forecast scenarios, which model recovery
path projections through to FY24.
As a result of the significant impact of COVID-19 on
the Group and the broader travel industry, and the
continued uncertainty with regards to the future
impact of COVID-19 on the Group’s operations, there
is considerable judgement involved in estimating the
expected recovery of the business in the short-term
and long-term and the key assumptions used in the
Group’s impairment valuation models, including
discount rates and long-term growth rates.
Given the degree of judgement involved in the
Group’s impairment models as a result of COVID-19,
and the financial significance of the goodwill
recognised on the Group’s consolidated statement of
financial position, we determined that this was a key
audit matter.
භ Assessing the arithmetical accuracy of the
impairment models
භ Assessing whether the allocation of assets,
including goodwill, to CGUs, was consistent
with our knowledge of the Group’s
operations and internal Group reporting
භ Assessing whether the CGUs included a
reasonable allocation of corporate overheads
භ Evaluating the Group’s forecast recovery
path projections through to FY24, by
comparison to external economic and
industry forecasts
භ Assessing that the discount rates applied in
the impairment models reflect the risks of
the CGU, with the assistance of PwC
valuation experts
භ Assessing the long-term growth rates, by
comparing to economic forecasts, with the
assistance of PwC valuation experts
භ Assessing the Group’s consideration of the
sensitivity to a change in key assumptions
that either individually or collectively would
be required for assets to be impaired and
considered the likelihood of such a
movement in those key assumptions arising
භ Evaluating the adequacy of the disclosures
made in Note 25, including those regarding
the key assumptions and sensitivities to
changes in such assumptions, in light of the
requirements of Australian Accounting
Standards.
Based on our procedures, for each of the Group’s
CGUs, we found that headroom remained between
the carrying value of the CGU’s
assets and the Group’s
calculation of the recoverable amount, and as such, no
impairment of goodwill was identified.
We also compared the Group’s net assets as at
30 June 2021 of $851.5m to its market capitalisation
of $2,931.8m at 30 June 2021, and noted the
$2,080.3m of implied headroom in the comparison.
138 CORPORATE TRAVEL MANAGEMENT
Independent
Auditor's Report
To the members of Corporate Travel Management Limited Continued
Key audit matter How our audit addressed the key audit
matter
Recognition and presentation of the Group’s
revenue
(Refer to note 4)
The Group’s provision of travel and related services to
clients drives several different revenue streams.
The recognition of revenue from each of these streams
is dependent upon the terms of the underlying
contracts with customers and suppliers.
Judgement is involved in the recognition of volume-
based incentive revenue, as revenue is accrued over
the contract period based on the expected
achievement of contractual performance criteria
specific to each supplier.
The Group has additional revenue streams following
the business combinations during the year, being
revenue from the sale or inventory and licencing
revenue.
We considered the recognition and presentation of
revenue to be a key audit matter due to the financial
significance of the Group’s revenue, the judgemental
nature of volume-based incentive revenue, and the
disclosure considerations per the requirements of
Australian Accounting Standards.
Our procedures in relation to the recognition and
presentation of the Group’s revenue included,
amongst others:
භ Developing an understanding of the Group’s
revenue recognition processes
භ Agreeing a sample of recorded fees and
commission transactions to supporting
documents, including customer agreements,
invoices and bank statements
භ Agreeing a sample of inventory sales and
licencing revenue transactions to supporting
documents, including customer agreements,
invoices and bank statements
භ Utilising data analytic techniques to identify
revenue transactions for our testing of
journal entries
භ Comparing on a sample basis, volume based
incentive revenue amounts to supporting
documents, including third party
confirmations, remittances and bank
statements
භ Assessing the completeness and accuracy of
the Group’s revenue disclosures per the
requirements of Australian Accounting
Standards.
Accounting for the T&T and Tramada
business combinations
(Refer to note 9)
The Group completed the acquisitions of Tramada
Holdings Pty Ltd (“Tramada”) and Travel and
Transport Inc. (“T&T”) on 29 and 30 October 2020
respectively.
We determined that the accounting for business
combinations was a key audit matter due to the
financial significance of the value of the transactions,
net assets acquired and resultant goodwill arising on
the acquisitions, as well as the level of judgement
involved in the Purchase Price Allocation (“PPA”)
calculations.
The key area of judgement related to the fair value of
the acquired assets and liabilities recognised at
acquisition date, including software, brands and client
contracts and relationships intangible assets.
Our procedures in relation to the accounting for
business combinations included, amongst others:
භ Testing of the initial consideration paid for
the acquisitions by obtaining supporting
documentation including bank statements
and the purchase agreement
භ Obtaining the purchase agreements to
determine whether any consideration is
contingent on future events
භ Testing a sample of acquired working capital
balances to post acquisition date payments
and receipts
භ Assessing the Group’s valuation of client
contracts and relationship intangible assets
and brands, with reference to forecast future
financial performance, industry benchmarks
and brand values from recent transactions.
139 ANNUAL REPORT 2021
Independent
Auditor's Report
To the members of Corporate Travel Management Limited Continued
Key audit matter How our audit addressed the key audit
matter
භ Assessing the Group’s methodology applied
in valuing software acquired
භ Assessing the mathematical accuracy of the
Group’s calculation of the resulting goodwill
arising on the PPA calculations
භ Considering the completeness of the
recognition of intangible assets by reference
to the purchase contract and intangible
assets recognised in previous acquisitions by
the Group
භ Assessing the accuracy and completeness of
business combination disclosures in the
financial statements in light of the
requirements of Australian Accounting
Standards.
Other information
The directors are responsible for the other information. The other information comprises the
information included in the annual report for the year ended 30 June 2021, 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 that we 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 the directors for the financial report
The directors of the Company are responsible for the preparation of the financial 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
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 ability of the Group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
140 CORPORATE TRAVEL MANAGEMENT
Independent
Auditor's Report
To the members of Corporate Travel Management Limited Continued
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 the 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 at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of
our auditor's report.
Report on the remuneration report
Our opinion on the remuneration report
We have audited the remuneration report included in pages 51 to 68 of the directors’ report for the
year ended 30 June 2021.
In our opinion, the remuneration report of Corporate Travel Management Limited for the year ended
30 June 2021 complies with section 300A of the Corporations Act 2001.
Responsibilities
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
Australian Auditing Standards.
PricewaterhouseCoopers
Michael Crowe Brisbane
Partner 18 August 2021
141 ANNUAL REPORT 2021
Distribution of equitable securities
Analysis of number of equitable security holders by size of holding:
Number of
holders of
ordinary shares Securities
% of Total
Securities
1 to 1,000 10,186 3,452,189 2.53
1,001 to 5,000 4,084 8,891,170 6.52
5,001 to 10,000 528 3,629,231 2.66
10,001 to 100,000 343 7,753,648 5.68
100,001 and over 40 112,699,278 82.61
Total 15,181 136,425,516 100.00
Based on the Company’s closing share price on 27 July 2021 ($21.38), there were 349 holders of less than a marketable
parcel of ordinary shares and together they hold 1,958 shares.
Equity security holders
The names of the twenty largest registered shareholders are listed below:
Number Held
Ordinary shares
% of total
shares issued
1. Citicorp Nominees Pty Limited 25,592,580 18.76
2. HSBC Custody Nominees (Australia) Limited 23,375,888 17.13
3. Pherous Holdings Group Pty Ltd 18,240,000 13.37
4. J P Morgan Nominees Australia Pty Limited 17,660,916 12.95
5. National Nominees Limited 7,606,619 5.58
6. BNP Paribas Nominees Pty Ltd (Agency Lending DRP A/C) 4,243,446 3.11
7. BNP Paribas Noms Pty Ltd (DRP) 2,781,383 2.04
8. Matimo Pty Ltd (Matimo A/C) 1,596,807 1.17
9. HSBC Custody Nominees (Australia) Limited (NT-Comnwlth Super Corp A/C) 1,484,429 1.09
10. Ms Helen Logas 1,120,710 0.82
11. Mr Steven Craig Smith 1,015,665 0.74
12. LJP2 Pty Ltd 1,000,000 0.73
13. BNP Paribas Noms (NZ) Ltd (DRP) 817,985 0.60
14. Citicorp Nominees Pty Limited (Colonial First State Inv A/C) 792,601 0.58
15. Shamiz Pty Ltd (Sami Superfund A/C) 566,393 0.42
16. BNP Paribas Nominees Pty Ltd HUB24 Custodial Serv Ltd (DRP A/C) 463,563 0.34
354,620 0.26
18. Mirrabooka Investments Limited 333,000 0.24
19. BNP Paribas Nominees Pty Ltd Six Sis Ltd (DRP A/C) 302,561 0.22
20. Ms Karen Ann Shaw 278,514 0.20
Top 20 Holders 109,627,680 80.36
Remaining Holders balance 26,797,836 19.64
Grand Total 136,425,516 100.00
Shareholder
Information
The shareholder information set out below was applicable as at 27 July 2021
142 CORPORATE TRAVEL MANAGEMENT
Equity security holders (continued)
Unquoted equity securities
Number on
issue
Number of
holders
Share appreciation rights 5,937,250 80
Substantial holders
Number Held
Ordinary shares
% of total
shares issued
Pherous Holdings Group 19,240,000 14.10
Bennelong Funds Management Group Pty Ltd 16,192,901 11.87
Mitsubishi UFJ Financial Group Inc. 7,598,974 5.59
Voting rights
The voting rights attaching to each class of equity securities are set out below:
Ordinary shares voting rights
On a show of hands, every member present at a meeting in person or by proxy shall have one vote. Upon a poll, each share
shall have one vote. There are currently no options held.
Share Appreciation Rights
Share appreciation rights have no voting rights.
Securities purchased on-market
During FY21, a total of 2,808 ordinary shares were acquired on-market for the purposes of the Company’s employee equity
plans and the average price per share purchased was $19.69.
Shareholder
Information
The shareholder information set out below was applicable as at 27 July 2021
143 ANNUAL REPORT 2021
Corporate
Directory
Directors Ewen Crouch AM
Jamie Pherous
Jon Brett
Sophie Mitchell
Secretary Anne Tucker
Annual General Meeting The Annual General Meeting of Corporate Travel Management Limited
is scheduled to be held on 28 October 2021 at 11:00am (AEST)
Registered ofce in Australia Level 24, 307 Queen Street
Brisbane QLD 4000
Telephone: +61 7 3211 2400
Share registrar Computershare Investor Services Pty Limited
Level 1, 200 Mary Street
Brisbane, QLD 4000
Telephone: 1300 787 272
Outside Australia: +61 3 9415 4000
Auditor PricewaterhouseCoopers Australia
480 Queen Street
Brisbane QLD 4000
Stock exchange listing Corporate Travel Management shares are quoted on the Australian Securities
Exchange (ASX).
Website address www.travelctm.com
ABN ABN 17 131 207 611
144 CORPORATE TRAVEL MANAGEMENT
