Cettire Annual Report 2021

Cettire

Annual Report

2021

About Cettire

Launched in 2017, Cettire is a global online retailer,

offering a large selection of in-demand personal luxury

goods via its website, cettire.com. Cettire has access

to an extensive catalogue of over 1,700 luxury brands

and over 190,000 products of clothing, shoes, bags,

and accessories. Visit: www.cettire.com.

■

Contents

2021 Highlights 2

Chairman’s Letter 4

CEO’s Letter 7

Performance Highlights 9

Directors’ Report 10

Auditor’s Independence Declaration 26

Statement of Profit or Loss

and Other Comprehensive Income 27

Statement of Financial Position 28

Statement of Changes in Equity 29

Statement of Cash Flows 30

Notes to the Financial Statements 31

Directors’ Declaration 62

Independent Auditor’s Report 63

Additional Information 67

Corporate Directory 70

Cettire Annual Report 2021

2021 Highlights

Cettire experienced a continuation

of its rapid growth in FY21 as it

increased its share of the global

personal luxury goods market.

Growth has been achieved through

adding new customers and

increasing revenue per customer.

Cettire’s rapid scaling has been

enabled by its proprietary

technology, which enables a high

degree of automation, and its deep

and diverse supply relationships.

304%

Sales revenue growth

285%

Active customers growth

40%

Gross revenue from repeat customers

Cettire Annual Report 2021

Chairman’s Letter

Dear Shareholders,

On behalf of the Board, I am

delighted to present Cettire’s

first Annual Report as a listed

company for the financial

year ended 30 June 2021.

It has been an incredible year for Cettire, with the

obvious highlight being our successful IPO on the ASX

in December 2020. The IPO has increased the profile

of the business and provided the Group with the

opportunity to begin to realise its growth potential.

2021 Highlights

The Group achieved sales revenue of $92.4m,

exceeding the prospectus forecast by 32%, and reflecting

a year-on-year increase of 304%. The Group also achieved

significant increases in key operating metrics attributable

to this growth in sales revenue. This has been achieved

by a focus on growing the customer base, improving rates

of conversion, retaining customers and driving average

order value by:

•

Building on its supplier network and expanding the

number of products accessible on its site to more

than 78,000 at period end

•

Securing partnerships with global buy now pay later

operators, Afterpay and Klarna, providing customers

with flexible payment options and maintaining market

competitiveness

•

Bolstering marketing and brand initiatives and efforts

•

Enhancing our customer proposition, for example,

by introducing and embedding a free returns policy

•

Ongoing investment in technology, which enhances

efficiency and improves customer experience.

FY22 Growth and Outlook

In line with the Group’s strategy, the business will continue

to invest in key initiatives aimed at growth in sales revenue.

In July 2021, the Group announced a natural extension

of its luxury product offering with the launch of a

children’s wear range. This is expected to increase

sales in our existing customer base in addition to

attracting new customers.

To facilitate an acceleration in the rate of customer growth,

additional resources will be allocated to key roles in

operations and technology.

Technological advancements are key to maintaining and

improving our online customer experience. Our customers

expect a convenient, flexible and efficient experience

and these features secure and retain our customers in a

competitive market. The business will continue to invest in

technology adding features to its online platform to ensure

the edge over our competitors. Features such as a greater

localisation capability and a mobile application are some

of the enhancements that are focus areas for engineering

effort in the near term. In a highly mobile and global

market, these features provide our existing and new

customers with additional flexibility and convenience.

As outlined in the Prospectus, Cettire’s marketing

capabilities continue to be essential to the success of the

platform. Investment in marketing and brand initiatives to

cost effectively acquire new and retain existing customers

will continue in FY22.

Capitalising on its extensive supplier relationships and

process automation, the business expects to significantly

grow the number of products accessible on its platform in

FY22. As Cettire grows, its technology platform, reach and

ability to sell large volumes at attractive margins continues

to be attractive to its supplier network.

In FY21, the management team has positioned the

business for ongoing growth into FY22 and beyond.

The Group’s management capability, insights, focus

and commitment will continue to deliver ongoing growth

and shareholder value.

I thank the Board, CEO Dean Mintz and the Management

team for their contribution over the past year and look

forward to building on the significant successes in the

year ahead.

Thank you to our shareholders who have invested

in the growth potential of Cettire.

I look forward to building long term value as the

Group executes on its growth ambitions

■

Kerry Robert (Bob) East

Chairman and Non-Executive Director

Cettire Annual Report 2021

CEO’s Letter

Dear Shareholders,

It gives me great honour

to be able to share Cettire’s

inaugural full‑year financial

results as an ASX‑listed

company.

It has been a phenomenal year of growth and

transformation for Cettire, highlighted by the IPO

of our company on the ASX in December 2020.

Our momentum across key metrics has accelerated,

notwithstanding a backdrop of global uncertainty

through COVID19. This is a testament to the attractiveness

of the global luxury market in which we operate, the

strength, resilience and traction of our business model

and the dedication of our exceptional team.

We want Cettire to be a leading global platform for all

members in the luxury value chain and I passionately

believe we are just getting started. We are relentlessly

focused on maximising the potential of our business.

Our strategic priorities are as follows: rapidly drive scale

in the core business, enhance our technology platform,

expand our product offering and supplier network and

grow our addressable market via adjacencies.

A key objective in pursuing our IPO was to unlock new

and incremental growth opportunities. Growth is our

number one priority. During the year, we significantly

stepped up our investment in customer acquisition

and grew active customers by 285% to 114,830.

New customer additions were a key driver of our sales

revenue, which grew 304% to $92.4 million. We continue

to see very strong growth rates across key markets

and will be further investing in customer acquisition

to capitalise on our momentum.

Our ability to serve and rapidly grow penetration

of a global market is made possible by our proprietary

core technology, which enables a high degree of

automation and efficiency in our core processes.

During the year, we made significant enhancements

to our technology platform, with an increasing focus on

customer-facing features including search and filtering.

Further, in August 2021, we announced the launch of

our proprietary e-commerce storefront software, which

represented the culmination of significant engineering

effort. This will provide Cettire with new capabilities

to support its global expansion. Further technology

investment will be a critical driver of customer experience

and conversion over time.

This year, we continued to diversify our supply chain,

adding depth and breadth to our product database.

We significantly grew the number of products available

on our platform, with accessible products increasing to

more than 78,000 at financial year end. Recently, we also

commenced direct partnerships with brand owners

which we see as a natural progression of our business

and complements our existing supplier network.

Adjacent markets represent a significant opportunity

for us to expand our addressable market and scale our

investments in technology and marketing. During the

financial year, we entered the children’s wear segment

via a new website vertical. As well as growing our

addressable market, this category expansion provides

scope to grow share of spend with existing customers

and introduce new potential customers to our platform.

Importantly, our customer feedback, as measured by

Trustpilot reviews, remained overwhelmingly positive,

despite growing orders by 4.5x year on year to more

than 170,000. This is particularly pleasing and highlights

the scalability of our platform.

A high-performance culture is one of the keys to our

success and our progress and performance during

FY21 can be attributed to our small and elite team.

On behalf of the Board and the executive team, I wish

to acknowledge and thank the team for their dedication

and focus.

I would like to sincerely thank our customers, our

suppliers our shareholders and all of our other partners

for their support through the year. I am immensely proud

of our progress to date, but even more excited by the

market opportunity ahead of us and the potential of

Cettire’s platform.

■

Dean Mintz

Chief Executive Officer

Cettire Annual Report 2021

Performance Highlights

$92.4m

Sales revenue versus

prospectus forecast

sales revenue of $70.0m

1 Cettire uses gross revenue as a non-IFRS measure of business performance and represents

revenue prior to returns and allowances.

2 Orders divided by unique website traffic.

3 Active Customers are unique customers who have made a purchase in the last 12 months.

FY21FY20FY19FY18 FY21FY20FY19FY18 FY21FY20FY19FY18

Unique web trafﬁc

Gross revenue

Sales revenue Product margin

Conversion rate

Active customers

$124.5m

$28.7m

$7.3m

$0.6m

$92.4m

$22.9m

$5.7m

$0.5m

$33.8m

$8.3m

$2.1m

$0.4m

13.9m

3.8m

1.5m

0.2m

1.22%

0.99%

0.68%

0.50%

114,830

29,838

8,800

893

Directors’ Report

30 June 2021

Your Directors present their report on the consolidated

entity (the “Group” or “Cettire”) consisting of Cettire Limited

(the “Parent” or ‘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 Cettire Limited

since the date of incorporation of the Parent and up to the

date of this report, unless otherwise stated:

Kerry (Bob) East, Chairman and Non-Executive Director

(appointed 29 October 2020)

Dean Mintz, Executive Director and Chief Executive Officer

(appointed 29 October 2020)

Bruce Rathie, Non-Executive Director

(appointed29 October 2020)

Richard (Rick) Dennis, Non-Executive Director

(appointed29 October 2020)

Company Secretary

Fiona van Wyk was Company Secretary from

29 October 2020 and up to the date of this report.

Principal activities

During the year the principal continuing activities of the

Group consisted of online retail sales.

Review of operations

During the year ended 30 June 2021, Cettire achieved

several important milestones and delivered strong

business results including:

• Sales revenue of $92.4 million, up 304% on the prior

corresponding period (“pcp”);

• Active customers growing to 114,830 (285% growth

vs pcp);

• 170,389 orders processed, up 353% on the pcp;

• 40% of gross revenue from returning customers

(26% in the pcp); and

• Successful IPO and listing on the ASX on

18 December 2020.

1 Dean Mintz was the sole Director and CEO of Ark Technologies Pty Ltd prior to the corporate re-organisation in which Cettire

became the legal parent of Ark Technologies Pty Ltd and its subsidiaries.

Financial performance

Sales revenue for the year was $92.4 million

(2020: $22.9 million), an increase of 304% on the pcp.

Growth was driven by a combination of customer growth

and sales revenue per active customer which increased

by 5% to $805 (2020: $766).

Statutory gross margin increased in the year to $22.0 million

(2020: $6.4 million), predominantly driven by the growth

in revenue.

Statutory net profit/(loss) after tax for the year was

$(0.3) million, (2020: $1.5 million), as the Group invested

for further growth. The statutory results were impacted

by one-off costs of $0.8 million relating to the IPO of

Cettire shares on the ASX.

Financial position

The Group ended the period with a cash balance of

$47.1 million and zero debt.

The cash balance includes the proceeds from the IPO.

The Group generated positive cash flows from operations

of $12.7 million.

Strategy

Cettire’s strategic focus is to grow its core business and

to continue to drive the significant growth trajectory the

Group has achieved to date. Cettire believes there is an

opportunity to significantly increase its share of, and to

benefit from further growth in, the personal luxury goods

market and the transition to online shopping by building on

Cettire’s own brand awareness and customer proposition

and improving core infrastructure to generate stronger

customer and unit economics.

The Group intends to invest across four key channels:

• Increase marketing to enhance brand awareness,

increase site traffic and revenue;

• Technical and operational enhancements;

• Expand product offering and supplier network; and

• Other adjacencies.

Cettire Annual Report 2021

Significant changes in the state of affairs

During the year ended 30 June 2021, the following

significant affairs occurred:

• Cettire Limited was incorporated on 29 October 2020

and became the parent entity of Ark Technologies Pty

Ltd (the “Pre-Existing Group”) on 27 November 2020

inanticipation of listing on the Australian Securities

Exchange (“ASX”).

• Cettire raised $40 million (80 million shares at

$0.50each) via an initial public offering (“IPO”) under

aprospectus (“Prospectus”) lodged with ASIC on

27 November 2020. The primary objectives of the

IPOwere to:

– provide the Group with access to capital

markets to fund growth;

– provide the Group with the benefits of an

increased profile that comes with being a

publicly listed company;

– provide the Group with the benefits of a liquid

market for its shares and an opportunity for

others to invest in the Group; and

– help accelerate the growth of the Cettire business;

• Successful listing on the ASX on 18 December 2020.

On 27 November 2020, a corporate re-organisation in

which Cettire Limited became the legal parent of Ark

Technologies Pty Ltd and its subsidiaries (the ‘Pre-Existing

Group’), was effected.

The Directors have accounted for the re-organisation as

acapital re-organisation. Accordingly, the Consolidated

Financial Statements have been prepared on a continuation

basis as if Cettire Limited has always controlled

the businesses comprising the Pre-Existing Group.

The comparative financial information presented in the

Consolidated Financial Statements represents that

ofthePre-Existing Group. This ensures consistency

ofpresentation with historical and forecast financial

information contained in the Prospectus.

There were no other significant changes in the state

ofaffairs of the Group during the financial period.

Dividends

During the year, dividends totalling $3,305,000 were paid

to the shareholder prior to the re-organisation and IPO.

Events occurring after balance sheet date

The impact of the COVID19 pandemic is ongoing and

it is not practicable to estimate the potential impact,

positive or negative, after the reporting date. Thesituation

is continually developing and is dependent onmeasures

imposed by the Australian Government and other

countries, such as maintaining social distancing

requirements, quarantine, travel restrictions and

any economic stimulus that may be provided.

No other item, transaction or event has arisen since

30 June 2021 that has significantly affected, or may

significantly affect the Group’s operations, the results

ofthose operations, or the Group’s state of affairs in

future financial periods.

Likely developments and expected results

of operations

Information on likely developments in the operations of

theGroup and the expected results of operations have

notbeen included in this report because the Directors

believe it would be likely to result in unreasonable

prejudice to the Group.

Environmental regulation

The Group is not subject to any significant environmental

regulation under Australian Commonwealth or State law.

Directors’ Report

Continued

Information on Directors

Directors’ qualifications and experience

Name Kerry Robert East (Bob)

Title Independent Non-Executive Director and Chairman

Experience

and expertise

Bob has more than 20 years’ experience in ASX listed organisations and government agencies.

With proven leadership capability and expertise, Bob served as CEO of the Mantra Group for

12years where he established Mantra Group as one of the largest Australian based hotel groups

in Australia. He led Mantra Group to a successful ASX listing in June 2014 which culminated in

its inclusion in the ASX 200 list in 2015. In 2018, Bob was instrumental in and managed Mantra

Group’s $1.3bn acquisition by AccorHotels, one of the world’s largest hotel operators, in 2018.

Bob is currently Chairman of Australian Venue Co Pty Ltd, Tourism Australia and deputy

chairman of the Gold Coast Football Club (Suns AFL).

Bob holds an MBA and is a Member of the Australian Institute of Company Directors (AICD).

Other current

listed company

directorships

Experience Co Limited (ASX:EXP) – Non-Executive Chairman (from April 2018)

Former listed

company

directorships

(last 3 years)

None

Special

responsibilities

Chairman of the Board

Member of the Audit & Risk Committee

Member of the Remuneration and Nomination Committee

Interests in shares 2,000,000 (Direct and Indirect)

Interests in options

over shares

Nil

Interests in rights Nil

Name Dean Mintz (Dean)

Title Executive Director and Chief Executive Officer

Experience

and expertise

Dean is the founder of Cettire, which he launched in 2017 out of Ark Technologies Pty Ltd, an

incubator founded by Dean in 2014. Ark Technologies focused on developing technological

innovation in social media, mobile, web applications and e-commerce.

Prior to Cettire, Dean ran a digital agency offering software development, web design and

internet marketing services with a prestigious client base including international corporate

clients and local government.

Dean has a 15-year long career as a serial entrepreneur, with a focus on cutting-edge technology.

Dean holds a Bachelor of Information Systems and Bachelor of Commerce (Finance) from the

University of Melbourne.

Other current

listed company

directorships

None

Cettire Annual Report 2021

Former listed

company

directorships

(last 3 years)

None

Special

responsibilities

None

Interests in shares 251,238,220 (Direct)

Interests in options

over shares

Nil

Interests in rights Nil

Name Bruce Rathie (Bruce)

Title Independent Non-Executive Director

Experience

and expertise

Having completed successful careers in law and finance, Bruce has been a professional

Non-Executive Director for more than 20 years.

His legal career included partnership of a prominent private law firm and following that,

Senior Corporate Counsel to Robert Holmes a Court’s Bell Resources Limited in the 1980s.

He pursued a career in investment banking in New York before returning to Sydney in 1990

where he continued his investment banking career predominantly at Salomon Smith Barney

which secured joint lead manager roles in the privatisation or IPOs of Qantas, Commonwealth

Bank and Telstra.

Bruce is currently Non-Executive Chairman of Capricorn Mutual Limited and Non-Executive

Director of Capricorn Society Limited and the Australian Meat Processors Corporation Limited.

Bruce holds an LLB and B Comm and an MBA from University Geneva. Bruce is also Fellow of

the Australian Institute of Company Directors, Australian Institute of Managers & Leaders and the

Governance Institute of Australia. Bruce also holds a Graduate Diploma in Company Secretarial

Practice (Governance).

Other current

listed company

directorships

PolyNovo Limited (ASX:PNV) (from February 2010)

4DMedical Limited (ASX:4DX) – Non-Executive Chairman (from December 2019)

Former listed

company

directorships

(last 3 years)

Netlinkz Limited (until 19 November 2020)

Special

responsibilities

Chairman of the Remuneration and Nomination Committee

Member of the Audit & Risk Committee

Interests in shares 1,010,000 (Direct and Indirect)

Interests in options

over shares

Nil

Interests in rights Nil

Directors’ Report

Continued

Name Richard Dennis (Rick)

Title Independent Non-Executive Director

Experience

and expertise

Rick had a 34-year career with Ernst & Young (EY) in Australia and Asia-Pacific. He was

Queensland Managing Partner from 2001 to 2007 and again in 2014. Rick established and led

EYAustralia’s China Business Group in 2005 and was CFO and Deputy COO of the firm in Asia

Pacific from 2010 to 2013. Rick was a member of the firm’s inaugural Asia Pacific executive

board and sat on several of EY’s global boards and committees.

Rick is currently a member of the Queensland Advisory Board of Australian Super and holds several

directorships and committee membership roles in public and private companies in Australia.

Rick is a Chartered Accountant and holds an LLB and B.Comm from the University of Queensland.

Other current

listed company

directorships

Motorcycle Holdings Limited (ASX:MTO) (from August 2016)

Apiam Animal Health Limited (ASX:AHX) (from November 2016)

Former listed

company

directorships

(last 3 years)

None

Special

responsibilities

Chairman of the Audit & Risk Committee

Member of the Remuneration and Nomination Committee

Interests in shares 25,000 (Direct)

Interests in options

over shares

Nil

Interests in rights Nil

‘Other current listed company directorships’ quoted above are current directorships for listed entities only and exclude

directorships of all other types of entities, unless otherwise stated.

‘Former listed company directorships (last 3 years)’ quoted above are directorships held in the last 3 years for listed

entities only and exclude directorships of all other types of entities, unless otherwise stated.

Company Secretary

Fiona van Wyk Fiona has over 25 years’ company secretarial, corporate governance and corporate compliance

experience, most notably as Company Secretary of the Mantra Group (ASX 200) where she was integral to the listing

ofMantra Group on the ASX in 2014 and the sale of the business to AccorHotels in 2018.

Fiona is a qualified Chartered Secretary and holds a Diploma in Corporate Law from the University of Johannesburg.

Fiona is a Fellow member of Governance Institute of Australia and a Member of the Australian Institute of

CompanyDirectors.

Cettire Annual Report 2021

Meetings of directors

The number of meetings of the Parent’s Board of Directors (the “Board”) held from date of incorporation until

30 June 2021, and the number of meetings attended by each Director were:

Director Board of Directors

Audit & Risk

Management Committee

Remuneration &

Nomination Committee

Held Attended Held Attended Held Attended

Bob East

5 5 3 3 3 3

Bruce Rathie

5 5 3 3 3 3

Rick Dennis

5 5 3 3 3 3

Dean Mintz 5 5 NA NA NA NA

NA – not a member of the relevant committee.

Remuneration report (audited)

A. Introduction

The Directors of Cettire are pleased to present the Remuneration Report (“Report”) for the KeyManagement Personnel

(“KMP”) for the financial year ended 30 June 2021.

The Group’s remuneration practices aim to:

• Align with the business needs, goals and financial and operational objectives of the Group with long-term sustainable

growth in shareholder value; and

• Motivate, retain, and attract key Executives.

In FY21, the Remuneration and Nominations Committee engaged independent remuneration consultants to conduct a

benchmarking exercise incorporating companies with similar market capitalisation and, to reward performance against

achieving agreed annual objectives, the Board introduced a short-term incentive (STI) framework for its Executive KMP.

The STI framework, effective from FY22, is outlined in section C of this Report.

Considering the significant efforts of the Executive KMP during the year, the overall performance of the business in

FY21 and the salesrevenue achieved versus the forecast for FY21 outlined in the IPO Prospectus, the Board awarded

the Executive KMP adiscretionary STI for FY21, details of which are outlined in section D of this Report.

The Employee Incentive Plan (the “Plan”), a summary of which was included in the IPO Prospectus lodged with ASIC on

27 November 2020 is designed with flexibility to award key employees with options, service rights and performance

rights aimed at delivery of the long-term success of the Group in line with the interests of shareholders.

During FY21, the Board:

• Granted options to the Chief Financial Officer (CFO) of Cettire, subject to long-term retention and share price growth; and

• Granted service rights to key employees aimed at long-term talent retention.

This Report is presented in accordance with the requirements of the Corporations Act 2001 and its regulations.

Information has been audited as required by Section 308 (3C) of the Corporations Act 2001.

Directors’ Report

Continued

B. Key management personnel

This Report outlines remuneration arrangements in place for the Group’s KMP’s which comprise Directors (Executive and

Non-Executive) and the CFO of the Group.

Cettire’s KMP for FY21 are outlined below.

Key Management Personnel

Name Position Dates

Non‑Executive Directors

Bob East Non-Executive Director and Chairman of the Board Appointed on 29 October 2020

Bruce Rathie Non-Executive Director and Chairman of the

Remuneration & Nomination Committee

Appointed on 29 October 2020

Rick Dennis Non-Executive Director and Chairman of the

Audit & Risk Committee

Appointed on 29 October 2020

Executive Director

Dean Mintz Chief Executive Officer (CEO) and Executive Director Appointed on 9 December 2014

Other KMP

Timothy Hume Chief Financial Officer (CFO) Appointed on 7 October 2020

1 Dean Mintz was the sole Director and CEO of Ark Technologies Pty Ltd prior to the corporate re-organisation in which Cettire

became the legal parent of Ark Technologies Pty Ltd and its subsidiaries.

C. Remuneration framework & composition

Cettire aims to reward executives based on their position and responsibility, with a level and mix of remuneration which has

both fixed and variable components. The executive remuneration and reward framework has three primary components:

• fixed remuneration

• at risk short-term incentives (STI)

• at risk long-term incentives (LTI)

Component Performance measures Purpose and link to objectives

Fixed remuneration

(Salary and other

benefits including

statutory

superannuation)

Experience and qualifications

Role and responsibility

Attract, retain and motivate

executives with the right skills,

capability and experience to

meet the objectives of Cettire

Short-term

incentives (STI)

(Performance based

incentives delivered

incash)

Based on annual performance criteria set on an annual

basis relevant to the specific role aimed at rewarding

year-on-year performance

Performance measures will be set annually for achieving goals

on an annual basis which align to the strategic goals of Cettire.

Performance measures will include both financial and

non-financial criteria

STI Target

CEO  Up to 75% of total fixed remuneration

CFO – up to 50% of total fixed remuneration

STI entitlement will be assessed after the end of each financial

year in conjunction with the completion of Cettire’s external audit.

Any entitlement will be paid at a date determined by the Board

following the release of Cettire’s financial results to the ASX.

Delivery of key financial

andoperational objectives

ofthe Group

Cettire Annual Report 2021

Component Performance measures Purpose and link to objectives

Long-term incentives

Granted in accordance

with the Company’s

Employee Incentive

Plan measured over

alonger period

• Options

• Service rights

• Performance rights

Performance and/or service conditions must be satisfied

before the relevant awards vest

Measures are based on vesting conditions aligned with

general market practice

Options – subject to standard market vesting conditions

over a long-term period

Service Rights –subject to an agreed retention period over

the long term

Performance Rights – subject to general market

vestingconditions determined on grant over a multi-year

vesting period

Performance conditions

aredesigned to focus on

keyperformance driving

sustainable long-term growth

in shareholder value

Aims to align executive and

shareholder interest through

share ownership

1 Effective from FY22.

D. Executive KMP remuneration outcomes for FY21

The Board considers that the current remuneration for Executive KMP achieves an appropriate balance between reward

for achieving improved Group performance and growth in shareholder value.

The remuneration outcome for Executive KMP in FY21 is set out on page 19.

a. Financial performance

The table below summarises the recent financial performance of the Group. Due to the IPO of Cettire in December 2020,

comparison is provided against FY20 only.

On 27 November 2020, a corporate re-organisation in which Cettire became the legal parent of Ark Technologies Pty Ltd

and its subsidiaries (Pre-Existing Group) was effected. The Consolidated Financial Statements have been prepared on

acontinuation basis as if Cettire has always controlled the businesses comprising the Pre-Existing Group. The financial

performance below represents the Consolidated Financial Statements of the Pre-Existing Group.

Company performance

Performance FY20 FY21

Revenue ($’000) 22,856 92,409

Net Profit ($’000) 1,532 (251)

Adjusted EBITDA ($’000)

2,754 2,082

Basic EPS (cents) 0.51 (0.07)

Annual TSR (%) NA 428%

Interim Dividend (cents) NA –

Final Dividend (cents) NA –

Share price at 30 June ($) NA 2.64

1 Cettire uses Adjusted EBITDA as a non-IFRS measure of business performance which excludes expenses associated with the IPO,

share-based payments and unrealised FX movements.

2 Calculated with reference to the IPO price of $0.50 per share.

3 During FY21, dividends totalling $3,305,000 were paid to the shareholder prior to the re-organisation and IPO.

Directors’ Report

Continued

b. Short‑Term Incentives (STI)

Acknowledging the benefit of achieving goals on an annual basis which align to the strategic goals of the Group, during

the year, the Board introduced STIs for Executive KMP based on performance criteria to be agreed and measured on an

annual basis, effective from FY22.

In addition, the Board awarded the Executive KMP a discretionary STI payment for FY21. The Board determined the FY21

STI award based on significant efforts and achievements in relation to:

• The listing of the Company on the ASX in December 2020;

• The overall performance of the Group for FY21; and

• The significant over performance in FY21 sales revenue versus FY21 forecast sales revenue outlined in the

IPO Prospectus.

The following table outlines the FY21 STI outcomes for the Executive KMP:

Executive KMP Position STI Award STI asa %ofFixed

Remuneration

Dean Mintz Chief Executive Officer (CEO) and Executive Director $180,000 52%

Timothy Hume CFO $40,000 14%

c. Long term incentives

FY21 LTI awards

During the year, in accordance with the Employee Incentive Plan and to align the interests of the CFO with the interests

of the shareholders, 2,500,000 options were issued to the CFO. Each option was issued for nil consideration and has

an exercise price of $1.21 per ordinary share, which was calculated based on a 2-month VWAP prior to the grant date.

The options vest in three equal tranches as follows:

Tranche 1 Tranche 2 Tranche 3

833,333 Options (1/3) vest on the day

after the release of the financial

statements for the half year ended

31 December 2023 to the ASX subject

to the CFO’s continued employment

with Cettire or a Group Company on

vesting date

833,333 Options (1/3) vest on the

day after the release of the financial

statements for the half year ended

31 December 2023 to the ASX

subject to (1) the CFO’s continued

employment with Cettire or a Group

Company on vesting date and (2)

the share price achieving $3.00

at any time during a 3 month period

commencing on vesting date based

on a 5 day VWAP

833,334 Options (1/3) vest on the

day after the release of the financial

statements for the half year ended

31 December 2023 to the ASX

subject to (1) the CFO’s continued

employment with Cettire or a Group

Company on vesting date and (2)

the share price achieving $4.00

at any time during a 3 month period

commencing on vesting date based

on a 5 day VWAP

At 30 June 2021, all options remain unvested.

At 30 June 2021, no performance rights or service rights had been granted to KMP.

Cettire Annual Report 2021

E. Executive remuneration for FY21

The accounting value of remuneration attributable to Executive KMP is set out below. This does not necessarily reflect

actual amounts paid to Executive KMP due to the conditional nature of some of these accrued amounts.

FY21 remuneration

Short‑term benefits

Post‑

employ ment

benefits

Long‑term

benefits

Share‑

based

payments

Salary

Cash

bonus

Non‑

mon etary

Super‑

annuation

Long‑

service

leave

Equity‑

settled

options

Total

Perform‑

ance

Executive Director

Dean Mintz 2021 327,051 180,000 57,157 18,750 307 – 583,265 30.9%

2020

– – – – – – – –

Executive Management

Timothy Hume 2021 273,814 40,000 – 16,271 267 56,742 387,094 15.3%

2020

– – – – – – – –

Total 2021 600,865 220,000 57,157 35,021 574 56,742 970,359

2020 – – – – – – –

1 Non-monetary benefits include car leases. To the extent non-monetary benefits are subject to Fringe Benefits Tax (FBT), amounts

shown include FBT.

2 Amounts disclosed reflect the accounting value of remuneration consisting of options, based on the value of options expensed

during the year. The fair value is estimated using a Binomial and a Monte Carlo model. This value may not represent the future value

that the Executive KMP will receive as the vesting of options is subject to the satisfaction of service and market conditions.

3 Dean Mintz did not receive a salary until 1 October 2020.

4 KMP from 7 October 2020.

Directors’ Report

Continued

F. Remuneration governance

The Remuneration & Nomination Committee’s role is to support and advise the Board in relation to Director and

Executiveremuneration. The Remuneration & Nomination Committee charter is available on the company’s website:

www.cettirecorporate.com.

a. Independent remuneration advisors

During the year, the Remuneration & Nomination Committee sought advice from independent Remuneration Consultants

Guerdon Associates (Guerdon) in relation to benchmarking short and long-term incentive awards for the CEO and CFO

of the Group. Guerdon was paid $24,158 for their services. In accordance with the Corporations Act 2001, Guerdon has

declared, and on that basis, the Board is satisfied that their advice has been provided free of any undue influence by any

member of the Executive KMP.

b. Securities Trading Policy

Cettire has adopted a Securities Trading Policy that applies to all employees of the Group including Non-Executive

Directors and Executive KMP and their associated persons.

c. Executive Employment Agreements

Remuneration and other terms of employment for Executive KMP are formalised in employment agreements.

These agreements are of a continuing nature and have no fixed term of service. Specific information relating to the

terms of theagreements for current Executive KMP is set out below.

Executive KMP

Base remuneration

inclusive of statutory

superannuation Term of agreement

Notice period

and termination

entitlement Restraint period

Dean Mintz $430,000 Ongoing contract 12 months Up to 12 months

Timothy Hume $370,000 Ongoing contract 3 months Up to 5 years

G. Non‑Executive Director remuneration

a. Policy and approach to setting fees

Cettire’s policy for remunerating Non-Executive Directors is based on market related fees for time, commitment and

responsibilities as Non-Executive Directors of the Group and aims to ensure Cettire can attract and retain suitably skilled,

experienced and committed individuals to serve on the Board.

b. Board composition

Bob East (Chairman of the Board), Bruce Rathie (Chairman of the Remuneration & Nomination Committee) and Rick Dennis

(Chairman of the Audit & Risk Committee) were appointed as Non-Executive Directors on 29 October 2020.

No other changes to the composition of the Non-Executive Directors, were made during the year.

c. Current fee structure

Non-Executive Directors are remunerated by way of a Directors fee. Directors receive statutory superannuation on the

Directors fee. No additional fees are paid for serving on Board Committees.

Non-Executive Directors are entitled to reimbursement for reasonable business-related expenses, including travel

expenses. Non-Executive Directors are covered by the Group’s Directors and Officers liability insurance policy.

In order to maintain independence, and impartiality, Non-Executive Directors are not entitled to any form

of incentive payments.

The aggregate Non-Executive Directors’ fee pool has been fixed at $1,000,000 per annum. This amount is currently

deemed appropriate and no increase is expected to be proposed in 2021. Any change to the annual Non-Executive

Directors’ fee pool is required to be approved by Shareholders.

Cettire Annual Report 2021

d. Non‑Executive Directors’ annual fees

Position 2021

2020

Non-Executive Director and Chairman of the Board 160,000 –

Non-Executive Director 80,000 –

1 Exclusive of statutory superannuation.

Cettire Limited was incorporated on 29 October 2020. Non-Executive Directors were appointed on 29 October 2020

in preparation of listing of Cettire on the ASX in December 2020.

e. Non‑Executive Directors’ remuneration received

2021

2020

Bob East 118,822 –

Bruce Rathie 59,411 –

Rick Dennis 59,411 –

Total Remuneration

237,644 –

1 Non-Executive Directors’ FY21 remuneration is inclusive of Directors’ fees and superannuation of $20,619. Non-Executive Directors

did not receive any other compensation FY21.

H. KMP EQUITY INTERESTS

a. Shareholdings

The number of shares in Cettire held during the financial year by KMP is set out below.

Ordinary shares Balance at

startof year

Corporate

re‑organisation

Received during

the year on

exercise of

options/rights

Additions/

(Disposals)

during the year

Balance at

30June 2021

Non‑Executive KMP

Bob East – – – 2,000,000 2,000,000

Bruce Rathie – – – 1,010,000 1,010,000

Rick Dennis – – – 25,000 25,000

Executive KMP

Dean Mintz 1 301,238,220

– (50,000,000)

251,238,220

Timothy Hume – – – 500,000 500,000

1 301,238,220 – (46,465,000) 254,773,220

1 On 27 November 2020, Dean Mintz’s 1 share in Ark Technologies Pty Ltd was exchanged for 301,238,220 shares in Cettire Limited

which became the legal parent of Ark Technologies Pty Ltd.

2 Dean Mintz sold 50,000,000 shares on IPO of Cettire on 18 December 2020.

Directors’ Report

Continued

b. Option holdings

The number of options over ordinary shares in Cettire held during the financial year by Executive KMP is set out below.

Options over ordinary shares On incorporation

ofParent

Granted as

remuneration

Exercised Balance at

30 June 2021

Executive KMP

Timothy Hume – 2,500,000 – 2,500,000

At 30 June 2021, all options remain unvested.

c. Details of options granted during FY21

For the options granted to KMP up to 30 June 2021, the key terms and valuation model inputs used to determine fair value

at the grant date are set out below.

Grant

date

Vesting

date

Expiry date Exercise

price

Expected

volatility

Dividend

yield

Risk‑free

interest

rate

Unit value

at grant

date

Total fair

value at

grant date

22/4/2021 28/2/2024

28/2/2026

$1.21 30% – 0.1% $0.68 $564,812

22/4/2021 28/2/2024

28/2/2026

$1.21 30% – 0.1% $0.23 $190,583

22/4/2021 28/2/2024

28/2/2026

$1.21 30% – 0.1% $0.14 $117,917

1 Options vest on the day after the release of the financial statements for the half year ended 31 December 2023, estimated to be

28 February 2024.

2 Each tranche expires if not exercised 2 years after the vesting date for that tranche.

The valuation has been performed using a Binomial and a Monte Carlo model.

I. KMP OTHER TRANSACTIONS

During FY21, a shareholder payable totalling $743,812 was repaid to Dean Mintz. This related to funding provided to the

Group prior to the IPO.

This concludes the remuneration report, which has been audited.

Cettire Annual Report 2021

Details of performance rights, service rights and share options

The following table shows the total numbers of unissued ordinary shares in Cettire subject to options or service rights

at the date of this Report.

Security Type Number in issue

at30 June 2021

Exercise Price Expiry Date

Options 2,500,000

$1.21 2 years after the vesting date relevant to each tranche

Service Rights 402,544 NIL 4 years from date of grant

1 Options issued to the Chief Financial Officer as part of their remuneration.

No performance rights were issued during the period.

Shares issued on the exercise of options or service rights

During the financial year and in the period since the end of the financial year to the date of this report, there were

noshares issued on exercise of options or service rights.

Corporate Governance Statement

The Directors are committed to achieving and demonstrating a high standard of corporate governance. The Group’s

Corporate Governance Statement is located on the Group’s website at www.cettirecorporate.com.

Indemnity and insurance of officers

The Group has indemnified the Directors and executives of the Group for costs incurred, in their capacity as a Director

orexecutive, for which they may be held personally liable, except where there is a lack of good faith.

During the financial year, the Group paid a premium in respect of a contract to insure the Directors and executives of

theGroup against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits

disclosure of the nature of the liability and the amount of the premium.

Indemnity and insurance of auditor

The Group has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the

Group or any related entity against a liability incurred by the auditor.

During the financial year, the Group has not paid a premium in respect of a contract to insure the auditor of the Group

orany related entity.

Proceedings on behalf of the Group

No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings

onbehalf of the Group, or to intervene in any proceedings to which the Group is a party for the purpose of taking

responsibility on behalf of the Group for all or part of those proceedings.

Non‑audit services

Details of the amounts paid or payable to the auditor for non-audit services provided during the financial year by the

auditor are outlined below and in note 25 to the financial statements.

Directors’ Report

Continued

Non‑audit services fees paid or payable to Grant Thornton

2021

2020

Other assurance services

Investigating accountant report 226,500 –

Tax due diligence report 58,076 –

Other services

Tax compliance services 56,502 26,000

Tax advisory services 25,926 –

Other accounting services 25,679 –

Total services provided by Grant Thornton 392,683 56,000

The non-audit services fees paid to the auditors include $284,576 for services in relation to the IPO and $56,502 for

services in relation to tax compliance.

The Directors are satisfied that the provision of non-audit services during the financial year, by the auditor (or by another

person or firm on the auditor’s behalf), is compatible with the general standard of independence for auditors imposed

bythe Corporations Act 2001.

The Directors are of the opinion that the services as disclosed in note 25 to the financial statements do not compromise

the external auditor’s independence requirements of the Corporations Act 2001 for the following reasons:

• all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity

of the auditor; and

• none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code

of Ethics for Professional Accountants issued by the Accounting Professional and Ethical Standards Board, including

reviewing or auditing the auditor’s own work, acting in a management or decision-making capacity for Cettire, acting

as advocate for Cettire or jointly sharing economic risks and rewards.

Rounding of amounts

The Group is of a kind referred to in Corporations Instrument 2016/191, issued by the Australian Securities and Investments

Commission, relating to ‘rounding-off’. Amounts in this report have been rounded off in accordance with that Corporations

Instrument to the nearest dollar.

Cettire Annual Report 2021

Auditor’s independence declaration

A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001

is set out immediately after this Directors’ report.

Auditor

Grant Thornton Audit Pty Ltd continues in office in accordance with section 327 of the Corporations Act 2001.

This report is made in accordance with a resolution of the Directors, pursuant to section 298(2)(a) of the

Corporations Act 2001.

Dean Mintz

Executive Director and CEO

Kerry Robert (Bob) East

Chairman and Non-Executive Director

30 August 2021

Grant Thornton Audit Pty Ltd ACN 130 913 594

subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389

‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory

services to their clients

and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Th

ornton International

Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each

member firm is a separate legal entity. Services are

delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do

not obligate one

another and are not liable for one another’s acts or omissi

ons. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to

Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to

Grant Thornton Aust

ralia Limited.

Liability limited by a scheme approved under Professional Standards Legislation.

www.grantthornton.com.au

Collins Square, Tower 5

727 Collins Street

Melbourne VIC 3008

Correspondence to:

GPO Box 4736

Melbourne VIC 3001

T +61 3 8320 2222

F +61 3 8320 2200

E info.vic@au.gt.com

W www.grantthornton.com.au

Auditor’s Independence Declaration

To the Directors of Cettire Limited

In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the audit of

Cettire 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.

Grant Thornton Audit Pty Ltd

Chartered Accountants

A C Pitts

Partner – Audit & Assurance

Melbourne, 30 August 2021

Auditor’s Independence Declaration

Cettire Annual Report 2021

Statement of Profit or Loss and Other Comprehensive Income

For the year ended 30 June 2021

Consolidated

Note

2021

2020

Revenue

Sales revenue 92,409,190 22,856,477

Cost of sales (70,433,479) (16,441,692)

Gross profit 21,975,711 6,414,785

Other income

1,105,924 483,968

Interest revenue calculated using the effective interest method 9,230 2,216

Expenses

Advertising and marketing expense (11,737,592) (1,935,168)

Merchant fees (4,460,304) (1,304,960)

Employee benefits expense (1,865,239) (351,177)

General and administrative expense (3,374,657) (757,077)

Initial Public Offering (IPO) costs (846,816) –

Amortisation expense 13 (663,415) (365,678)

Profit before income tax expense 142,842 2,186,909

Income tax expense 7 (393,981) (654,774)

Profit after income tax expense for the year attributable

totheowners of Cettire Limited

(251,139) 1,532,135

Other comprehensive income for the year, net of tax – –

Total comprehensive income for the year attributable

totheowners of Cettire Limited 20 (251,139) 1,532,135

Cents Cents

Basic earnings per share

(0.07) 0.51

Diluted earnings per share 32 (0.07) 0.51

The above statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes.

Statement of Financial Position

As at 30 June 2021

Consolidated

Note

2021

2020

Assets

Current assets

Cash and cash equivalents 8 47,130,634 4,669,244

Trade and other receivables 9 1,743,596 188,613

Inventories 10 584,344 197,169

Derivative financial instruments 11 – 6,787

Research and development incentive receivable 7 – 308,033

Other assets 12 422,714 6,472

Total current assets 49,881,288 5,376,318

Non‑current assets

Intangibles 13 5,474,603 3,431,431

Deferred tax assets 7 2,466,813 114,275

Total non-current assets 7,941,416 3,545,706

Total assets 57,822,704 8,922,024

Liabilities

Current liabilities

Trade and other payables 14 18,011,437 4,699,619

Related party payables 16 – 743,812

Contract liabilities 15 903,617 273,753

Derivative financial instruments 11 259,713 –

Income tax 7 – 186,346

Employee benefits 17 155,778 30,701

Deferred income 18 410,712 264,591

Total current liabilities 19,741,257 6,198,822

Non‑current liabilities

Deferred tax liabilities 7 636,677 150,264

Employee benefits 17 8,312 1,912

Deferred income 18 1,673,550 1,047,382

Total non-current liabilities 2,318,539 1,199,558

Total liabilities 22,059,796 7,398,380

Net assets 35,762,908 1,523,644

Equity

Issued capital 19 188,344,920 1

Re-organisation reserve 19 (150,619,110) –

Share-based payments reserve 19 69,594 –

(Accumulated losses)/Retained profits 20 (2,032,496) 1,523,643

Total equity 35,762,908 1,523,644

The above statement of financial position should be read in conjunction with the accompanying notes.

Cettire Annual Report 2021

Statement of Changes in Equity

For the year ended 30 June 2021

Consolidated

Issued

capital

(Accumulated

losses)/

Retained

profits

Re‑

organisation

reserve

Share‑based

payments

reserve

Total

equity

Balance at 1 July 2019 1 (8,492) – – (8,491)

Profit after income tax

expense for the year – 1,532,135 – – 1,532,135

Other comprehensive income

for the year, net of tax – – – – –

Total comprehensive income

for the year – 1,532,135 – – 1,532,135

Balance at 30 June 2020 1 1,523,643 – – 1,523,644

Consolidated

Issued

capital

(Accumulated

losses)/

Retained

profits

Re‑

organisation

reserve

Share‑based

payments

reserve

Total

equity

Balance at 1 July 2020 1 1,523,643 – – 1,523,644

Profit after income tax

expense for the year – (251,139) – – (251,139)

Other comprehensive income

for the year, net of tax – – – – –

Total comprehensive income

for the year – (251,139) – – (251,139)

Transactions with members

in their capacity as members

Pre-IPO re-organisation 150,619,110 – (150,619,110) – –

Shares issued at IPO, net of

transaction costs and tax 37,725,809 – – – 37,725,809

Share-based payments – – – 69,594 69,594

Dividend paid (note 21) – (3,305,000) – – (3,305,000)

Balance at 30 June 2021 188,344,920 (2,032,496) (150,619,110) 69,594 35,762,908

The above statement of changes in equity should be read in conjunction with the accompanying notes.

Statement of Cash Flows

For the year ended 30 June 2021

Consolidated

Note

2021

2020

Cash flows from operating activities

Receipts from customers (inclusive of GST) 94,537,909 22,997,724

Payments to suppliers and employees (inclusive of GST) (81,118,227) (17,481,009)

13,419,682 5,516,715

Government grants received 88,729 –

IPO costs paid (846,816) –

Interest received 9,230 2,216

Research and development incentive received 308,033 –

Income tax refunded/(Paid) (240,109) –

Net cash from operating activities 30 12,738,749 5,518,931

Cash flows from investing activities

Payments for intangibles 13 (2,706,587) (1,325,168)

Net cash used in investing activities (2,706,587) (1,325,168)

Cash flows from financing activities

Payments to related parties (743,812) (340,487)

Proceeds from issue of shares

40,000,000 –

IPO costs paid (3,248,845) –

Dividend paid 21 (3,305,000) –

Net cash used in financing activities 32,702,343 (340,487)

Net increase in cash and cash equivalents 42,734,505 3,853,276

Cash and cash equivalents at the beginning of the period 4,669,244 815,968

Effect of exchange rate changes on cash and cash equivalents (273,115) –

Cash and cash equivalents at the end of the period 8 47,130,634 4,669,244

The above statement of cash flows should be read in conjunction with the accompanying notes.

Cettire Annual Report 2021

Notes to the Financial Statements

30 June 2021

Note 1. General information

The financial statements cover Cettire Limited (the “Group”

or “Cettire”) as a group consisting of Cettire Limited

(the “Parent” or “Parent Entity”) and the entities it controlled

at the end of, or during, the period. The financial statements

are presented in Australian dollars, which is the Group’s

functional and presentation currency.

Cettire Limited is a company limited by shares,

incorporated and domiciled in Australia, with a listing on

the Australian Securities Exchange (ASX). Its registered

office and principal place of business is:

Level 40

140 William Street

Melbourne Vic 3000

A description of the nature of the Group’s operations and

its principal activities are included in the Directors’ report,

which is not part of the financial statements.

The financial statements were authorised for issue,

inaccordance with a resolution of the Directors,

on30August 2021.

Note 2. Significant accounting policies

The principal accounting policies adopted in the

preparation of the financial statements are set out either

inthe respective notes or below. These policies have been

consistently applied to all of the years presented, unless

otherwise stated.

New or amended Accounting Standards and

Interpretations adopted

The Group has adopted all of the new or amended

Accounting Standards and Interpretations issued by

the Australian Accounting Standards Board (AASB)

that are mandatory for the current reporting period.

Any new or amended Accounting Standards or

Interpretations that are not yet mandatory have not been

early adopted. There are no standards that are not yet

effective that would be expected to have a material impact

on the Group in the current or future reporting periods and

on foreseeable future transactions.

The following Accounting Standards and Interpretations

are most relevant to the Group:

Conceptual Framework for Financial Reporting

(Conceptual Framework)

The consolidated entity has adopted the revised

Conceptual Framework from 1 July 2020. The Conceptual

Framework contains new definition and recognition criteria

as well as new guidance on measurement that affects

several Accounting Standards, but it has not had a material

impact on the Group’s financial statements.

Configuration or Customisation Costs in a Cloud

Computing Arrangement (IAS 38 Intangible Assets)

During the financial year the International Financial

Reporting Interpretations Committee IFRIC identified that

various approaches to customisation and configuration

costs for cloud computing arrangements were utilised

by companies depending on internal policy. These policies

varied from expensing all costs in full to capitalisation

of all costs in full, with most entities taking a more

nuanced approach in their capitalisation policy and

differentiating between expenditure with different

underlying fact patterns.

The Agenda Decision requires that management capitalise

those elements of expenditure that meet the definition of

an “Intangible Asset” as defined by AASB 138 Intangible

Assets and recognise any additional amounts as an

expense as the entity benefits from the expenditure –

either by applying AASB 138 or applying another

accounting standard.

The impact of this decision has not had a material impact

on the consolidated entity’s financial statements.

Basis of preparation

These general-purpose financial statements have been

prepared in accordance with Australian Accounting

Standards and Interpretations issued by the Australian

Accounting Standards Board (‘AASB’) and the

Corporations Act 2001, as appropriate for for-profit

oriented entities. These financial statements also comply

with International Financial Reporting Standards as issued

by the International Accounting Standards Board (‘IASB’).

Historical cost convention

The financial statements have been prepared under the

historical cost convention, except for, where applicable,

therevaluation of financial assets and liabilities at fair value

through profit or loss, financial assets at fair value through

other comprehensive income, investment properties,

certain classes of property, plant and equipment and

derivative financial instruments.

Critical accounting estimates

The preparation of the financial statements requires the

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areas where assumptions and estimates are significant

to the financial statements, are disclosed in note 3.

Notes to the Financial Statements

Continued

Note 2. Significant accounting policies

continued

Parent entity information

In accordance with the Corporations Act 2001, these

financial statements present the results of the Group only.

Supplementary information about the parent entity is

disclosed in note 35.

Principles of consolidation

The consolidated financial statements incorporate the

assets and liabilities of all subsidiaries of Cettire Limited

(‘Parent’ or ‘Parent Entity’) as at 30 June 2021 and the

results of all subsidiaries for the year then ended. Cettire

Limited and its subsidiaries together are referred to in

these financial statements as the ‘Group’ or ‘Cettire’.

Subsidiaries are all those entities over which the Group

has control. The Group controls an entity when the Group

is exposed to, or has rights to, variable returns from its

involvement with the entity and has the ability to affect

those returns through its power to direct the activities of

the entity. Subsidiaries are fully consolidated from the date

on which control is transferred to the Group. They are

de-consolidated from the date that control ceases.

Intercompany transactions, balances and unrealised

gains on transactions between entities in the Group are

eliminated. Unrealised losses are also eliminated unless

the transaction provides evidence of the impairment of the

asset transferred. Accounting policies of subsidiaries have

been changed where necessary to ensure consistency

with the policies adopted by the Group.

The acquisition of subsidiaries is accounted for using the

acquisition method of accounting. A change in ownership

interest, without the loss of control, is accounted for as

an equity transaction, where the difference between the

consideration transferred and the book value of the share

of the non-controlling interest acquired is recognised

directly in equity attributable to the parent.

Where the Group loses control over a subsidiary, it

derecognises the assets including goodwill, liabilities and

non-controlling interest in the subsidiary together with any

cumulative translation differences recognised in equity.

The Group recognises the fair value of the consideration

received and the fair value of any investment retained

together with any gain or loss in profit or loss.

Operating segments

Operating segments are presented using the ‘management

approach’, where the information presented is on the same

basis as the internal reports provided to the Chief Operating

Decision Makers (‘CODM’). The CODM is responsible for

the allocation of resources to operating segments and

assessing their performance.

Refer to note 5 for further information.

Foreign currency translation

The financial statements are presented in Australian dollars,

which is the Group’s functional and presentation currency.

Foreign currency transactions

Foreign currency transactions are translated into Australian

dollars using the exchange rates prevailing at the dates of

the transactions. Foreign exchange gains and losses

resulting from the settlement of such transactions and from

the translation at financial year-end exchange rates of

monetary assets and liabilities denominated in foreign

currencies are recognised in profit or loss.

Foreign operations

The assets and liabilities of foreign operations are

translated into Australian dollars using the exchange rates

at the reporting date. The revenues and expenses of foreign

operations are translated into Australian dollars using

theaverage exchange rates, which approximate the rates

atthe dates of the transactions, for the period. All resulting

foreign exchange differences are recognised in other

comprehensive income through the foreign currency

reserve in equity.

The foreign currency reserve is recognised in profit

orlosswhen the foreign operation or net investment

isdisposed of.

Revenue recognition

The Group recognises revenue as follows:

Principal versus agent

The Group is primarily responsible for fulfilling the promise

(performance obligation) to provide the specified good to

the Group’s customers. The Group also bears the risk for

the acceptance of the good and is responsible for any good

in transit. Therefore, the Group is the principal in these

transactions and revenue is recognised as the gross selling

price net of rebates, discounts and refunds.

Revenue from contracts with customers

Revenue is recognised at an amount that reflects the

consideration to which the Group is expected to be entitled

in exchange for transferring goods or services to a customer.

For each contract with a customer, the Group: identifies

the contract with a customer; identifies the performance

obligations in the contract; determines the transaction

price which takes into account estimates of variable

consideration and the time value of money; allocates the

Cettire Annual Report 2021

transaction price to the separate performance obligations

on the basis of the relative stand-alone selling price of each

distinct good or service to be delivered; and recognises

revenue when or as each performance obligation is

satisfied in a manner that depicts the transfer to the

customer of the goods or services promised.

Variable consideration within the transaction price,

if any, reflects concessions provided to the customer

such as discounts, rebates and refunds, any potential

bonuses receivable from the customer and any other

contingent events. Such estimates are determined using

either the ‘expected value’ or ‘most likely amount’ method.

The measurement of variable consideration is subject

to a constraining principle whereby revenue will only be

recognised to the extent that it is highly probable that a

significant reversal in the amount of cumulative revenue

recognised will not occur. The measurement constraint

continues until the uncertainty associated with the variable

consideration is subsequently resolved. Amounts received

that are subject to the constraining principle are

recognised as a refund liability.

Sale of goods

Revenue from the sale of goods is recognised at the point

in time when the customer obtains control of the goods,

which is generally at the time of delivery.

Interest

Interest revenue is recognised as interest accrues using

the effective interest method. This is a method of

calculating the amortised cost of a financial asset and

allocating the interest income over the relevant period

using the effective interest rate, which is the rate that

exactly discounts estimated future cash receipts through

the expected life of the financial asset to the net carrying

amount of the financial asset.

Other revenue

Other revenue is recognised when the promised

performance obligation is satisfied.

Current and non‑current classification

Assets and liabilities are presented in the statement

offinancial position based on current and non-current

classification.

An asset is classified as current when: it is either expected

to be realised or intended to be sold or consumed in the

Group’s normal operating cycle; it is held primarily for

the purpose of trading; it is expected to be realised within

12months after the reporting period; or the asset is cash

orcash equivalent unless restricted from being exchanged

or used to settle a liability for at least 12 months after

the reporting period. All other assets are classified

as non-current.

A liability is classified as current when: it is either expected

to be settled in the Group’s normal operating cycle; it is

held primarily for the purpose of trading; it is due to be

settled within 12 months after the reporting period; or there

is no unconditional right to defer the settlement of the

liability for at least 12 months after the reporting period.

Allother liabilities are classified as non-current.

Deferred tax assets and liabilities are always classified

as non-current.

Impairment of non‑financial assets

Non-financial assets are reviewed for impairment whenever

events or changes in circumstances indicate thatthe

carrying amount may not be recoverable. An impairment

loss is recognised for the amount by which the asset’s

carrying amount exceeds its recoverable amount.

Recoverable amount is the higher of an asset’s fair value

less costs of disposal and value-in-use. The value-in-use

isthe present value of the estimated future cash flows

relating to the asset using a pre-tax discount rate specific

to the asset or cash-generating unit to which the asset

belongs. Assets that do not have independent cash flows

are grouped together to form a cash-generating unit.

Goods and Services Tax (‘GST’) and other similar taxes

Revenues, expenses and assets are recognised net of

theamount of associated GST, unless the GST incurred

isnot recoverable from the tax authority. In this case it is

recognised as part of the cost of the acquisition of the

asset or as part of the expense.

Receivables and payables are stated inclusive of the

amount of GST receivable or payable. The net amount

ofGST recoverable from, or payable to, the tax authority

isincluded in other receivables or other payables in the

statement of financial position.

Cash flows are presented on a gross basis. The GST

components of cash flows arising from investing or

financing activities which are recoverable from, or payable

to the tax authority, are presented as operating cash flows.

Commitments and contingencies are disclosed net

of the amount of GST recoverable from, or payable to,

the tax authority.

Government grants

Government grants are recognised in profit or loss on

a systematic basis over the periods in which the entity

recognises as expenses the related costs for which

the grants are intended to compensate.

Notes to the Financial Statements

Continued

Note 3. Critical accounting judgements,

estimates and assumptions

The preparation of the financial statements requires

management to make judgements, estimates and

assumptions that affect the reported amounts in the

financial statements. Management continually evaluates

itsjudgements and estimates in relation to assets,

liabilities, contingent liabilities, revenue and expenses.

Management bases its judgements, estimates and

assumptions on historical experience and on other

various factors, including expectations of future events,

management believes to be reasonable under the

circumstances. The resulting accounting judgements

and estimates will seldom equal the related actual results.

The judgements, estimates and assumptions that have

asignificant risk of causing a material adjustment to the

carrying amounts of assets and liabilities (refer to the

respective notes) within the next financial year are

discussed below.

Public listing and corporate re-organisation

Cettire Limited was incorporated on 29 October 2020.

During the period, the Group undertook an Initial

Public Offering (IPO) and corporate re-organisation.

On27 November 2020, the corporate re-organisation,

inwhich Cettire Limited became the legal parent of Ark

Technologies Pty Ltd and its subsidiaries (‘Pre-Existing

Group’), was effected.

The Directors have accounted for the re-organisation as

acorporate restructure. Accordingly, the Consolidated

Financial Statements have been prepared as a continuation

of the Pre-Existing Group. In the Directors’ judgement, the

continuation of existing accounting values is consistent

with the accounting which would have occurred if the

assets and liabilities had already been in a structure

suitable to IPO and most appropriately reflects the

substance of the internal restructure.

Accordingly, the financial statements reflect a continuation

of the Pre-Existing Group and, as a result:

• The assets and liabilities of the Group include the

carrying values of the assets and liabilities of the

Pre-Existing Group rather than fair value;

• The retained earnings and other shareholders equity

balances recognised in the Consolidated Financial

Statements include the existing retained earnings

andother equity balances of the Pre-Existing Group;

• No goodwill has been recognised as a result of the

re-organisation;

• The Consolidated Financial Statements include

financial results for the Group from re-organisation to

30 June 2021 and the Pre-Existing Group for theperiod

of 1 July 2020 to the date of re-organisation;

• The comparatives presented are those of the

Pre-Existing Group;

• The amounts recognised as issued capital in the

Consolidated Financial Statements of Cettire Ltd

reflectthe impact of the restructure and the market

capitalisation of Cettire at the date of the IPO

(lesscosts that are offset against issued capital); and

• An offsetting entry to a re-organisation reserve has

been recognised to align total equity with the net asset

position of the Group.

Initial Public Offering (IPO) costs

On 17 December 2020, the Group undertook an IPO to list

on the ASX. Costs incurred that are directly attributable

and incremental to the issuance of newequity (net of tax)

have been recognised in equity asan offset to the value

of capital raised. The Directors exercised judgement in

determining an allocation methodology (between equity

and expense) for costs which relate to both the issuance of

new equity and other activities. The Group’s methodology

was determined with reference to the number of new

shares issued in raising capital, and the nature and purpose

of services rendered inincurring costs. All other costs were

taken directly to thestatement of profit or loss and other

comprehensive income during the period.

Share-based payment transactions

The Group measures the cost of equity-settled

transactions with employees by reference to the fair value

of the equity instruments at the date at which they are

granted. In respect of options, the fair value is determined

by using either the Binomial, Black-Scholes or Monte Carlo

model taking into account the terms and conditions upon

which the instruments were granted. The accounting

estimates and assumptions relating to equity-settled

share-based payments would have no impact on the

carrying amounts of assets and liabilities within the next

annual reporting period but may impact profit or loss

and equity.

Estimation of useful lives of intangible assets

The Group determines the estimated useful lives and

related amortisation charges for its finite life intangible

assets. The useful lives could change significantly as a

result of technical innovations or some other event.

The amortisation charge will increase where the useful

lives are less than previously estimated lives, or technically

obsolete or non-strategic assets that have been abandoned

or sold will be written off or written down.

Cettire Annual Report 2021

Recovery of deferred tax assets

Deferred tax assets are recognised for deductible

temporary differences only if the Group considers it is

probable that future taxable amounts will be available

toutilise those temporary differences and losses.

Employee benefits provision

As discussed in note 17, the liability for employee benefits

expected to be settled more than 12 months from the

reporting date are recognised and measured at the present

value of the estimated future cash flows to be made in

respect of all employees at the reporting date.

Indetermining the present value of the liability, estimates

ofattrition rates and pay increases through promotion

and inflation have been taken into account.

Contract liabilities and Stock-in-transit

In determining the level of the contract liabilities (refer to

note 15) and stock-in-transit (refer to note 10), the Group

has made judgements in respect of the expected time to

complete its performance obligations for delivery of goods

to the customer. Historical experience has been taken into

account in determining the contract liabilities and

stock-in-transit.

Note 4. Restatement of comparatives

Reclassification

During the year, the Group determined that some costs included as General and administrative expense in the prior year

are more accurately classified as Merchant fees. These costs have been reclassified to Merchant fees in the current year

and comparative figures have been adjusted to conform to changes in the presentation in the current year. The impact on

the statement of profit or loss and other comprehensive income in the prior year has been shown in the extract below.

Thereclassification had no impact on total comprehensive income.

Statement of profit or loss and other comprehensive income

Consolidated

Extract

2020

Reported

Adjustment

2020

Restated

Expenses

Merchant fees (861,425) (443,535) (1,304,960)

General and administrative expense (1,200,612) 443,535 (757,077)

Notes to the Financial Statements

Continued

Note 5. Operating segments

Identification of reportable operating segments

The Group is organised into one (1) operating segment: online retail sales. The determination of this operating segment is

based on the internal reports that are reviewed and used by the CEO (who is identified as the Chief Operating Decision

Maker (‘CODM’)) in assessing performance and in determining the allocation of resources.

The CODM reviews EBITDA (earnings before interest, tax, depreciation and amortisation). The accounting policies

adopted for internal reporting to the CODM are consistent with those adopted in the financial statements.

The information reported to the CODM is on a monthly basis.

Major customers

During the reporting period and the comparative period, no individual customer contributed more than 10 per cent of the

Group’s revenue.

Disaggregation of revenue and non‑current assets by Geographical regions

The Group operates in Australia and internationally. Revenue is attributed to the country where the customer payment

is registered i.e. billing address.

Consolidated

Year ended 30 June 2021

2021

2020

Revenue

United States 62,323,407 15,082,562

Australia 8,319,607 1,411,390

Other 21,766,176 6,362,525

Total 92,409,190 22,856,477

Consolidated

2021

2020

Non-Current Assets

Australia 5,474,603 3,431,431

Other – –

Total 5,474,603 3,431,431

Cettire Annual Report 2021

Note 6. Other income

Consolidated

2021

2020

Government grants 88,729 11,271

Insurance recoveries 557,795 300,364

Research and development tax incentive 459,400 172,333

Other income 1,105,924 483,968

Note 7. Income tax

Consolidated

2021

2020

Income tax expense

Current tax 1,231,687 696,537

Deferred tax – origination and reversal of temporary differences (891,471) (41,763)

Under provision in prior years 53,765 –

Aggregate income tax expense 393,981 654,774

Deferred tax included in income tax expense comprises:

Increase in deferred tax assets (1,377,884) (60,326)

Increase in deferred tax liabilities 486,413 18,563

Deferred tax – origination and reversal of temporary differences (891,471) (41,763)

Numerical reconciliation of income tax expense and tax at the statutoryrate

Profit before income tax expense 142,842 2,186,909

Tax at the statutory tax rate of 30% (2020: 27.5%) 42,853 601,400

Tax effect amounts which are not deductible/(taxable) in calculating

taxable income:

Amortisation of intangibles 178,865 100,561

Research and development incentive income (137,820) (47,392)

Non-deductible research and development costs 151,799 –

Under provision in prior years 53,765 –

Sundry items 101,246 205

Adjustment to deferred tax balances as a result of a change

in statutory taxrate 3,273 –

Income tax expense 393,981 654,774

Notes to the Financial Statements

Continued

Note 7. Income tax continued

Consolidated

2021

2020

Deferred tax asset

Deferred tax asset comprises temporary differences attributable to:

Amounts recognised in profit or loss:

Deferred customer revenue 271,085 75,281

Refunds Payable 458,718 –

Gift card liabilities 137,434 –

Derivative financial instruments 77,914 –

Employee benefits 161,453 11,906

Accrued expenses 36,804 27,088

IPO Costs recognised in profit or loss 201,799 –

Carried forward tax losses 344,217 –

1,689,424 114,275

Amounts recognised in equity

IPO costs recognised in equity 777,389 –

777,389 –

Deferred tax asset 2,466,813 114,275

Movements:

Opening balance 114,275 53,949

IPO costs recognised in equity 974,654 –

Credited to profit or loss 1,377,884 60,326

Closing balance 2,466,813 114,275

Cettire Annual Report 2021

Consolidated

2021

2020

Deferred tax liability

Deferred tax liability comprises temporary differences attributable to:

Amounts recognised in profit or loss:

Derivative financial instruments – 1,866

Inventories 175,303 54,220

Prepayments – 1,780

Accrued supplier credits 380,736 –

Development costs 80,638 92,398

Deferred tax liability 636,677 150,264

Movements:

Opening balance 150,264 131,701

Charged to profit or loss 486,413 18,563

Closing balance 636,677 150,264

Consolidated

2021

2020

Research and development incentive receivable – 308,033

Refer to note 18 for the accounting policy for research and development.

Consolidated

2021

2020

Provision for income tax – 186,346

Notes to the Financial Statements

Continued

Note 7. Income tax continued

Accounting policy for income tax

The income tax expense or benefit for the period is the tax payable on that period’s taxable income based on the

applicable income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable

to temporary differences, unused tax losses and the adjustment recognised for prior periods, where applicable.

Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when

the assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted,

except for:

• When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in

atransaction that is not a business combination and that, at the time of the transaction, affects neither the accounting

nor taxable profits; or

• When the taxable temporary difference is associated with interests in subsidiaries, associates or joint ventures, and

thetiming of the reversal can be controlled and it is probable that the temporary difference will not reverse in the

foreseeable future.

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.

The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date.

Deferred tax assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be

available for the carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the

extent that it is probable that there are future taxable profits available to recover the asset.

Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets

against current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable

authority on either the same taxable entity or different taxable entities which intend to settle simultaneously.

Note 8. Cash and cash equivalents

Consolidated

2021

2020

Current assets

Cash at bank 46,968,348 4,588,664

Cash on deposit 162,286 80,580

47,130,634 4,669,244

Accounting policy for cash and cash equivalents

Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term,

highly liquid investments with original maturities of three months or less that are readily convertible to known amounts

of cash and which are subject to an insignificant risk of changes in value.

Cettire Annual Report 2021

Note 9. Trade and other receivables

Consolidated

2021

2020

Current assets

Other receivables 1,743,596 188,613

Accounting policy for trade and other receivables

Other receivables are recognised at amortised cost, less any allowance for expected credit losses.

Note 10. Inventories

Consolidated

2021

2020

Current assets

Stock in transit – at cost 584,344 197,169

Accounting policy for inventories

Stock in transit is stated at the lower of cost and net realisable value. Cost comprises of purchase and delivery costs,

net of rebates and discounts received or receivable.

Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion

and the estimated costs necessary to make the sale.

Note 11. Derivative financial instruments

Consolidated

2021

2020

Current assets

Forward foreign exchange contracts – 6,787

Current liabilities

Forward foreign exchange contracts 259,713 –

Refer to note 23 for further information on fair value measurement.

Accounting policy for derivative financial instruments

Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently

remeasured to their fair value at each reporting date. The accounting for subsequent changes in fair value depends

on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged.

Derivatives are classified as current or non-current depending on the expected period of realisation.

Notes to the Financial Statements

Continued

Note 12. Other assets

Consolidated

2021

2020

Current assets

Prepayments 399,670 6,472

Other 23,044 –

422,714 6,472

Note 13. Intangibles

Consolidated

2021

2020

Non‑current assets

Website and software development – at cost 6,729,178 4,035,985

Less: Accumulated amortisation (1,266,630) (604,554)

5,462,548 3,431,431

Trademarks – at cost 13,394 –

Less: Accumulated amortisation (1,339) –

12,055 –

5,474,603 3,431,431

Reconciliations

Reconciliations of the written down values at the beginning and end of the current period are set out below:

Consolidated Website and

software

development

Trademarks

Total

Balance at 1 July 2019 2,471,941 – 2,471,941

Additions 1,325,168 – 1,325,168

Amortisation expense (365,678) – (365,678)

Balance at 30 June 2020 3,431,431 – 3,431,431

Additions 2,693,193 13,394 2,706,587

Amortisation expense (662,076) (1,339) (663,415)

Balance at 30 June 2021 5,462,548 12,055 5,474,603

Cettire Annual Report 2021

Accounting policy for intangible assets

Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at their fair value

at the date of the acquisition. Intangible assets acquired separately are initially recognised at cost. Indefinite life intangible

assets are not amortised and are subsequently measured at cost less any impairment. Finite life intangible assets are

subsequently measured at cost less amortisation and any impairment. The gains or losses recognised in profit or loss

arising from the derecognition of intangible assets are measured as the difference between net disposal proceeds

and the carrying amount of the intangible asset. The method and useful lives of finite life intangible assets are reviewed

annually. Changes in the expected pattern of consumption or useful life are accounted for prospectively by changing

the amortisation method or period.

Website and software development

Website and software research costs are expensed in the period in which they are incurred. Website and software

development costs are capitalised when it is probable that the project will be a success considering its commercial and

technical feasibility; the Group is able to use or sell the asset; the Group has sufficient resources and intent to complete

the development; and its costs can be measured reliably. Capitalised website and software development costs are

amortised on a straight-line basis over the period of their expected benefit, being their finite life of 5 years commencing

one year from the date of capitalisation, or when the asset becomes ready for use, whichever is later.

Trademarks

Significant costs associated with trademarks are deferred and amortised on a straight-line basis over the period of their

expected benefit, being their finite life of 10 years.

Note 14. Trade and other payables

Consolidated

2021

2020

Current liabilities

Trade payables 14,753,855 4,218,766

Other payables 1,728,523 480,853

Refunds payable 1,529,059 –

18,011,437 4,699,619

Refer to note 22 for further information on financial instruments.

Accounting policy for trade and other payables

These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year

andwhich are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted.

Theamounts are unsecured and are usually paid within the agreed credit terms.

Accounting policy for refunds payable

These amounts represent the goods expected to be returned by customers as a result of ‘change of mind’ or defective

goods. The expected value of refunds payable is estimated based on historical data and a review of sales for the year

andrefunds issued post year-end applicable to those sales.

Notes to the Financial Statements

Continued

Note 15. Contract liabilities

Consolidated

2021

2020

Current liabilities

Contract liabilities 903,617 273,753

Reconciliation

Reconciliation of the written down values at the beginning and end of the current

and previous financial year are set out below:

Opening balance 273,753 (189,063)

Payments received in advance 903,617 273,753

Transfer to revenue – included in the opening balance (273,753) 189,063

Closing balance 903,617 273,753

Accounting policy for contract liabilities

Contract liabilities represent the Group’s obligation to transfer goods or services to a customer and are recognised

whena customer pays consideration, or when the Group recognises a receivable to reflect its unconditional right

toconsideration (whichever is earlier) before the Group has transferred the goods or services to the customer.

Note 16. Related party payables

Consolidated

2021

2020

Current liabilities

Payables to shareholder – 743,812

Note 17. Employee benefits

Consolidated

2021

2020

Current liabilities

Annual leave 155,778 30,701

Non‑current liabilities

Long service leave 8,312 1,912

Cettire Annual Report 2021

Accounting policy for employee benefits

Short-term employee benefits

Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be

settled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities

are settled.

Other long-term employee benefits

The liability for annual leave and long service leave not expected to be settled within 12 months of the reporting date are

measured at the present value of expected future payments to be made in respect of services provided by employees up

to the reporting date using the projected unit credit method. Consideration is given to 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 high quality corporate bonds with terms to maturity and currency that match, as closely as

possible, the estimated future cash outflows.

Defined contribution superannuation expense

Contributions to defined contribution superannuation plans are expensed in the period in which they are incurred.

Note 18. Deferred income

Consolidated

2021

2020

Current liabilities

Deferred research and development incentive 410,712 264,591

Non‑current liabilities

Deferred research and development incentive 1,673,550 1,047,382

Movements in deferred revenue/income during the current financial year are set out below:

Deferred research and development incentive Current

Non‑current

Total

Carrying amount at 1 July 2019 172,333 801,783 974,116

Additional income deferred – 510,190 510,190

Transferred to current 264,591 (264,591) –

Income recognised (172,333) – (172,333)

Carrying amount at 30 June 2020 264,591 1,047,382 1,311,973

Additional income deferred – 1,036,880 1,036,880

Transferred to current 410,712 (410,712) –

Income recognised (264,591) – (264,591)

Carrying amount at 30 June 2021 410,712 1,673,550 2,084,262

Notes to the Financial Statements

Continued

Note 18. Deferred income continued

Accounting policy for deferred research and development incentive

The Group receives a tax offset from the government for some of the cost of doing eligible research and development

activities. The Group has claimed a non-refundable tax offset of 38.5% of eligible research and development spend.

For the year ended 30 June 2019, the Group claimed a refundable tax offset of 43.5% of eligible research and

development spend, which is paid in cash after submission of a valid claim.

The incentive should be recognised in profit or loss over the periods necessary to match the benefit of the credit with

thecosts for which it is intended to compensate. Where the research and development has been in whole or in part

capitalised, the Group has accounted for the tax benefit as deferred income that is recognised in profit or loss on

asystematic basis matching the useful life of the asset.

Note 19. Issued capital and reserves

a. Ordinary Shares

Consolidated

2021

2020

2021

2020

Ordinary shares – fully paid 381,238,220 1 188,344,920 1

Ordinary shares

Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the parent

inproportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value

andthe parent does not have a limited amount of authorised capital.

On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each

share shall have one vote.

Please refer to note 33 for details of outstanding rights and options in regards to Ordinary Shares.

b. Movements in issued share capital

Shares Issue Price $

1 July 2020 1 $1.00 1

Pre-IPO re-organisation (note 19 (c)) 301,238,219 $0.50 150,619,110

Issue of shares on initial public offering (“IPO”) 80,000,000 $0.50 40,000,000

Costs directly attributable to IPO capital raising

(netof tax) (2,274,191)

30 June 2021 381,238,220 188,344,920

Cettire Annual Report 2021

c. Re‑organisation reserve

Consolidated $

Balance at 1 July 2020 –

Arising on Group re-organisation (note 3) (150,619,110)

Balance at 30 June 2021 (150,619,110)

The Group re-organisation reserve arose as a result of the corporate re-organisation undertaken on 27 November and

described in note 3.

d. Share‑based payments reserve

Consolidated $

Balance at 1 July 2020 –

Share-based payments expense (note 33) 69,594

Balance at 30 June 2021 69,594

The reserve is used to recognise the value of equity benefits provided to employees as part of their remuneration.

e. Capital risk management

The Group’s objective when managing capital is to safeguard its ability to continue as a going concern, so that it can

provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to

reduce the cost of capital.

Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net debt is

calculated as total borrowings less cash and cash equivalents.

In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders,

return capital to shareholders, issue new shares or sell assets to reduce debt.

Note 20. (Accumulated losses)/Retained profits

Consolidated

2021

2020

Retained profits/(accumulated losses) at the beginning of the financial year 1,523,643 (8,492)

Profit after income tax expenses for the year (251,139) 1,532,135

Dividend paid (note 21) (3,305,000) –

(Accumulated losses)/Retained profits at the end of the financial year (2,032,496) 1,523,643

Notes to the Financial Statements

Continued

Note 21. Dividends

Consolidated

2021

2020

Dividends paid during the period 3,305,000 –

Dividends

A dividend was paid to the shareholder prior to the re-organisation and IPO. At the time the dividend was declared there

was 1 ordinary share in issue.

Franking credits

Consolidated

2021

2020

Deferred debit balance of the franking account at the beginning

of the period 1,338,892 1,015,048

Franking credits that will arise from the payment of the amount

of the provision for income tax at the reporting date – (186,346)

Franking credits that will arise from the payment of income tax that

wasunder provided for in prior years (53,765) –

Franking debits that will arise from the offset/receipt of the research

anddevelopment offset for the current year 1,231,687 510,190

Balance of franking account adjusted for deferred debits arising from

pastresearch and development offsets received and expected research

and development tax offsets to be received for the current year 2,516,814 1,338,892

Note 22. Financial instruments

Financial risk management objectives

The Group’s activities expose it to a variety of financial risks: market risk (including foreign currency risk, price risk and

interest rate risk), credit risk and liquidity risk. The Group’s overall risk management program focuses on the unpredictability

of financial markets and seeks to minimise potential adverse effects on the financial performance of the Group. The Group

uses derivative financial instruments such as forward foreign exchange contracts to mitigate certain risk exposures.

Derivatives are exclusively used for hedging purposes, i.e. not as trading or other speculative instruments. The Group uses

different methods to measure different types of risk to which it is exposed. These methods include sensitivity analysis in

the case of interest rate, foreign exchange and other price risks, ageing analysis for credit risk and beta analysis in respect

of investment portfolios to determine market risk.

Risk management is carried out by senior finance executives (‘finance’) under policies approved by the Directors

(‘the Board’). These policies include identification and analysis of the risk exposure of the Group and appropriate procedures,

controls and risk limits. Finance identifies, evaluates and mitigates financial risks within the Group’s operating units.

Finance reports to the Board on a monthly basis.

Cettire Annual Report 2021

Market risk

Foreign currency risk

The Group undertakes certain transactions denominated in foreign currency and is exposed to foreign currency risk

through foreign exchange rate fluctuations.

Foreign exchange risk arises from future commercial transactions and recognised financial assets and financial liabilities

denominated in a currency that is not the entity’s functional currency. The risk is measured using sensitivity analysis and

cash flow forecasting.

The maturity, settlement amounts and the average contractual exchange rates of the Group’s outstanding forward foreign

exchange contracts at the reporting date were as follows:

Sell Australian dollars Average exchange rates

2021

2020

$ 2021 2020

Buy US dollars

Maturity:

0  3 months – 347,729 – 1.4379

Sell EUR Average exchange rates

2021

2020

$ 2021 2020

Buy US dollars

Maturity:

0  3 months – 563,190 – 0.8878

Sell USD Average exchange rates

2021

2020

$ 2021 2020

Buy Australian dollars

Maturity:

0  3 months 1,936,819 77,480 1.3567 1.4661

Buy Euros

Maturity:

0  3 months 9,496,687 2,755 0.8269 0.8885

Notes to the Financial Statements

Continued

Note 22. Financial instruments continued

The carrying amount of the Group’s foreign currency denominated financial assets and financial liabilities at the reporting

date were as follows:

Assets Liabilities

Consolidated

2021

2020

2021

2020

US dollars 12,759,127 3,953,718 3,448,672 392,322

Euros 429,720 16,351 17,406,185 3,069,048

Pound Sterling 676,193 161,190 65,436 25,456

Chinese Yuan 1,012 – 21,900 –

Hong Kong Dollar – – 6,871 –

13,866,052 4,131,259 20,949,064 3,486,826

The Group is exposed to foreign currency sensitivity from its existing financial liabilities, however this is mitigated through

the use of forward foreign exchange contracts.

Price risk

The Group is not exposed to any significant price risk.

Interest rate risk

The Group is not exposed to any significant interest rate risk.

Credit risk

The Group has adopted a lifetime expected loss allowance in estimating expected credit losses to other receivables

through the use of a provisions matrix using fixed rates of credit loss provisioning. These provisions are considered

representative across all customers of the Group based on recent sales experience, historical collection rates and

forward-looking information that is available.

Generally, other receivables are written off when there is no reasonable expectation of recovery. Indicators of this

includethe failure of a debtor to engage in a repayment plan, no active enforcement activity and a failure to make

contractual payments for a period greater than 1 year.

The Group is not exposed to any significant credit risk.

Liquidity risk

Vigilant liquidity risk management requires the Group to maintain sufficient liquid assets (mainly cash and cash

equivalents) and available borrowing facilities to be able to pay debts as and when they become due and payable.

The Group manages liquidity risk by maintaining adequate cash reserves and available borrowing facilities by continuously

monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and liabilities.

Remaining contractual maturities

The following tables detail the Group’s remaining contractual maturity for its financial instrument liabilities. The tables

havebeen drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which

thefinancial liabilities are required to be paid. The tables include both interest and principal cash flows disclosed as

remaining contractual maturities and therefore these totals may differ from their carrying amount in the statement of

financial position.

Cettire Annual Report 2021

Consolidated – 2021 Weighted

average

interest rate

1 year

or less

Between

1 and 2 years

Between

2 and 5 years

Over

5 years

Remaining

contractual

maturities

Non‑derivatives

Non‑interest bearing

Trade payables – 14,753,855 – – – 14,753,855

Other payables – 811,878 – – – 811,878

Refunds payable – 1,529,059 – – – 1,529,059

Total non-derivatives 17,094,792 – – – 17,094,792

Consolidated – 2020 Weighted

average

interest rate

1 year

or less

Between

1 and 2 years

Between

2 and 5 years

Over

5 years

Remaining

contractual

maturities

Non‑derivatives

Non‑interest bearing

Trade payables – 4,218,766 – – – 4,218,766

Other payables – 480,853 – – – 480,853

Shareholder payables – (743,812) – – – (743,812)

Total non-derivatives 5,443,431 – – – 5,443,431

The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually

disclosedabove.

Other payables is shown excluding $916,645 as these arise from statute rather than contract.

Fair value of financial instruments

Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.

Derecognition of financial assets

A financial asset is derecognised when the holder’s contractual rights to its cash flows expires, or the asset is transferred

in such a way that all the risks and rewards of ownership are substantially transferred.

All of the following criteria need to be satisfied for derecognition of financial asset:

• the right to receive cash flows from the asset has expired or been transferred;

• all risk and rewards of ownership of the asset have been substantially transferred; and

• the Group no longer controls the asset (i.e. the Group has no practical ability to make a unilateral decision to sell the

asset to a third party).

Notes to the Financial Statements

Continued

Note 22. Financial instruments continued

Derecognition of financial liabilities

A liability is derecognised when it is extinguished (i.e. when the obligation in the contract is discharged, cancelled or

expires). An exchange of an existing financial liability for a new one with substantially modified terms, or a substantial

modification to the terms of a financial liability is treated as an extinguishment of the existing liability and recognition

ofanew financial liability.

Note 23. Fair value measurement

Fair value hierarchy

The following tables detail the Group’s assets and liabilities, measured or disclosed at fair value, using a three-level

hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being:

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access

atthemeasurement date

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability,

eitherdirectly or indirectly

Level 3: Unobservable inputs for the asset or liability

Consolidated – 2021 Level 1

Level 2

Level 3

Total

Liabilities

Forward foreign exchange

contracts – 259,713 – 259,713

Total assets – 259,713 – 259,713

Consolidated – 2020 Level 1

Level 2

Level 3

Total

Assets

Forward foreign exchange

contracts – 6,787 – 6,787

Total assets – 6,787 – 6,787

There were no transfers between levels during the period.

The carrying amounts of trade and other receivables and trade and other payables are assumed to approximate their

fairvalues due to their short-term nature.

The fair value of financial liabilities is estimated by discounting the remaining contractual maturities at the current

marketinterest rate that is available for similar financial liabilities.

Valuation techniques for fair value measurements categorised within level 2 and level 3

Derivative financial instruments have been valued using quoted market rates. This valuation technique maximises

theuseof observable market data where it is available and relies as little as possible on entity specific estimates.

Cettire Annual Report 2021

Accounting policy for fair value measurement

When an asset or liability, financial or non-financial, is measured at fair value for recognition or disclosure purposes,

the 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,

assuming they act in their economic best interests. For non-financial assets, the fair value measurement is based on

its highest and best use. Valuation techniques that are appropriate in the circumstances and for which sufficient data

are available to measure fair value, are used, maximising the use of relevant observable inputs and minimising the use

of unobservable inputs.

Assets and liabilities measured at fair value are classified into three levels, using a fair value hierarchy that reflects the

significance of the inputs used in making the measurements. Classifications are reviewed at each reporting date and

transfers between levels are determined based on a reassessment of the lowest level of input that is significant to the

fairvalue measurement.

For recurring and non-recurring fair value measurements, external valuers may be used when internal expertise is either

not available or when the valuation is deemed to be significant. External valuers are selected based on market knowledge

and reputation. Where there is a significant change in fair value of an asset or liability from one period to another, an

analysis is undertaken, which includes a verification of the major inputs applied in the latest valuation and a comparison,

where applicable, with external sources of data.

Note 24. Key management personnel disclosures

Directors

The following people were Directors of Cettire Limited during the financial year:

Kerry (Bob) East – Non-Executive Director

Dean Mintz – Chief Executive Officer

Bruce Rathie – Non-Executive Director

Rick Dennis – Non-Executive Director

Other key management personnel

The following persons also had the authority and responsibility for planning, directing and controlling the major activities

of the Group, directly or indirectly during the financial year:

Timothy Hume – CFO

Compensation

The aggregate compensation made to Directors and other members of key management personnel of the Group

issetoutbelow:

Consolidated

2021

2020

Short-term employee benefits 1,095,047 –

Post-employment benefits 55,640 –

Long-term benefits 574 –

Share-based payments 56,742 –

1,208,003 –

The KMP of Ark Technologies Pty Ltd received no remuneration in 2020.

Notes to the Financial Statements

Continued

Note 25. Remuneration of auditors

During the financial year the following fees were paid or payable for services provided by Grant Thornton Audit Pty Ltd,

the auditor of the Group:

Consolidated

2021

2020

Audit and review services

Audit and review of the financial statements 102,500 30,000

Other assurance services

Investigating accountant report 226,500 –

Tax due diligence report 58,076 –

Other services

Tax compliance services 56,502 26,000

Tax advisory services 25,926 –

Other accounting services 25,679 –

Total services provided by Grant Thornton Audit Pty Ltd 495,183 56,000

Note 26. Contingent liabilities

The Group has outstanding standby letters of credit in favour of selected suppliers as at 30 June 2021 of $162,286

(2020: $80,580). The standby letters of credit are secured by a term deposit held by the Group.

Note 27. Commitments

The Group had no commitments as at 30 June 2021 or 30 June 2020.

Cettire Annual Report 2021

Note 28. Related party transactions

Parent entity

Cettire Limited is the parent entity.

Subsidiaries

Interests in subsidiaries are set out in note 34.

Transactions with related parties

There were no transactions with related parties during the period, with the exception of the repayment of the payable

repaid to the shareholder set out below.

Payable to related parties

The following balances are outstanding at the reporting date in relation to transactions with related parties:

Consolidated

2021

2020

Current payables:

Payables to shareholder – 743,812

Loans to/from related parties

There were no loans to or from related parties at the current and previous reporting date.

Terms and conditions

All transactions were made on normal commercial terms and conditions and at market rates.

Note 29. Events after the reporting period

The impact of the Coronavirus (COVID19) pandemic is ongoing and it is not practicable to estimate the potential impact,

positive or negative, after the reporting date. The situation is continually developing and is dependent on measures

imposed by the Australian Government and other countries, such as maintaining social distancing requirements,

quarantine, travel restrictions and any economic stimulus that may be provided.

No other item, transaction or event has arisen since 30 June 2021 that has significantly affected, or may significantly

affect the Group’s operations, the results of those operations, or the Group’s state of affairs in future financial periods.

Notes to the Financial Statements

Continued

Note 30. Reconciliation of profit after income tax to net cash from operating activities

Consolidated

2021

2020

Profit after income tax expense for the year (251,139) 1,532,135

Adjustments for:

Amortisation 663,415 365,678

Net fair value loss/(gain) on forward foreign exchange contracts 266,500 1,227

Unrealised exchange loss/(gain) 273,115 –

Share-based payment expense 69,594 –

Change in operating assets and liabilities:

Increase in trade and other receivables (1,554,983) (188,613)

Increase in inventories (387,175) (62,264)

Increase in deferred tax assets (1,377,884) (60,326)

Increase in other assets (416,242) (725)

Decrease in research and development incentive receivable 308,033 –

Increase in trade and other payables 13,311,818 3,278,864

Increase in contract liabilities 629,864 84,690

Decrease in provision for income tax (186,346) 186,346

Increase in deferred tax liabilities 486,413 18,563

Increase in employee benefits 131,477 25,499

Increase in other operating liabilities 772,289 337,857

Net cash from operating activities 12,738,749 5,518,931

Cettire Annual Report 2021

Note 31. Changes in liabilities arising from financing activities

Consolidated Shareholder

payables

Total

Balance at 1 July 2019 1,084,299 1,084,299

Net cash used in financing activities (340,487) (340,487)

Balance at 30 June 2020 743,812 743,812

Net cash used in financing activities (743,812) (743,812)

Balance at 30 June 2021 – –

Note 32. Earnings per share

Consolidated

2021

2020

Profit after income tax attributable to the owners of Cettire Limited (251,139) 1,532,135

Consolidated

Weighted average number of shares used as the denominator

2021

Number

2020

Number

Balance at beginning of period – adjusted for impact of Group re-organisation 301,238,220 301,238,220

Shares issued during the period 80,000,000 –

Balance at end of period – adjusted for impact of Group re-organisation 381,238,220 301,238,220

Weighted average number of ordinary shares used in calculating

basicearnings per share 344,635,480 301,238,220

Weighted average number of ordinary shares used in calculating

dilutedearnings per share 344,654,500 301,238,220

AASB 113 requires that where a share split occurs the calculation of basic and diluted EPS for all periods presented

shall be adjusted retrospectively. 301,238,220 shares represent the proportion of shares at listing that were on hand

at previous period end.

Cents Cents

Basic earnings per share (0.07) 0.51

Diluted earnings per share (0.07) 0.51

Notes to the Financial Statements

Continued

Note 32. Earnings per share continued

Accounting policy for earnings per share

Basic earnings per share

Basic earnings per share is calculated by dividing the profit attributable to the owners of Cettire Limited, excluding

anycosts of servicing equity other than ordinary shares, by the weighted average number of ordinary shares

outstandingduring the financial year, adjusted for bonus elements in ordinary shares issued during the financial year.

Diluted earnings per share

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account

the after-income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the

weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential

ordinary shares.

Note 33. Share‑based payments

Share-based payments for the Group relate to securities issued under the Employee Incentive Plan (“EIP”). The EIP was

implemented in November 2020 prior to the IPO of the Parent, to provide for equity-based remuneration of employees

in the listed environment. Granting of share rights is facilitated by the EIP. As at 30 June 2021, a total of 2,500,000 options

over fully paid ordinary shares and 402,544 service rights to fully paid ordinary shares have been issued under the EIP.

Set out below are summaries of the options granted under the EIP. The options are subject to:

• Achievement of the applicable share price condition for the relevant tranche over the relevant performance period; and

• Continued employment with the Group until the vesting date of the relevant tranche.

2021

Grant date

Expiry date Exercise

price

Balance at

the start of

the year

Granted Exercised Expired/for‑

feited/other

Balance at

the end of

the year

22/4/2021 28/2/2026 $1.21 – 833,333 – – 833,333

22/4/2021 28/2/2026 $1.21 – 833,334 – – 833,334

– 2,500,000 – – 2,500,000

Weighted average exercise price – $1.21 – – $1.21

The weighted average remaining contractual life of options outstanding at the end of the financial year was 4.67 years

(2020: nil).

No options were exercisable at the end of the financial year.

The share-based payment expense during the financial year was $69,594 (2020: nil), of which $56,742 (2020: nil) related

to the granting of options under the EIP.

Cettire Annual Report 2021

For the options granted during the current financial year, the valuation model inputs used to determine the fair value at the

grant date are as follows:

Grant date Vesting date Expiry date Exercise

price

Expected

volatility

Dividend

yield

Risk‑free

interest

rate

Unit value

at grant

date

Total fair

value at

grant date

22/4/2021 28/2/2024

28/2/2026

$1.21 30% – 0.1% $0.68 $564,812

22/4/2021 28/2/2024

28/2/2026

$1.21 30% – 0.1% $0.23 $190,583

22/4/2021 28/2/2024

28/2/2026

$1.21 30% – 0.1% $0.14 $117,917

1 Options vest on the day after the release of the financial statements for the half year ended 31 December 2023, estimated to be

28 February 2024.

2 Each tranche expires if not exercised 2 years after the vesting date for that tranche.

The valuation has been performed using a Binomial and a Monte Carlo model. Expected volatility was determined with

reference to historical volatility of publicly traded peer companies.

Set out below are the summaries of the service rights granted under the EIP. The service rights are subject to:

• Continued employment with the Group until the vesting date of the relevant tranche.

Grant date Share rights issued Fair value per unit at

grant date

Fair value at

grantdate

1/6/2021 296,612 $2.45 $726,699

3/6/2021 105,932 $2.35 $248,940

The fair value for rights was the share price on the grant date.

In the financial year, a total share-based payment expense of $12,852 (2020: nil) was recognised in relation to issuance

of service rights under the EIP.

Accounting policy for share‑based payments

Equity-settled share-based compensation benefits are provided to employees.

Equity-settled transactions are awards of shares, rights to shares, or options over shares, that are provided to employees

in exchange for the rendering of services.

The cost of equity-settled transactions is measured at fair value on grant date. Fair value is determined using either

theBinomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the option,

theimpact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected

dividend yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do

notdetermine whether the consolidated entity receives the services that entitle the employees to receive payment.

Noaccount is taken of any other vesting conditions.

The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the

vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the

best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The amount

recognised in profit or loss for the period is the cumulative amount calculated at each reporting date less amounts already

recognised in previous periods.

Market conditions are taken into consideration in determining fair value. Therefore, any awards subject to market

conditions are considered to vest irrespective of whether that market condition has been met, provided all other

conditions are satisfied.

Notes to the Financial Statements

Continued

Note 33. Share‑based payments continued

If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made.

An additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair

value of the share-based compensation benefit as at the date of modification.

If the non-vesting condition is within the control of the consolidated entity or employee, the failure to satisfy the condition

is treated as a cancellation. If the condition is not within the control of the consolidated entity or employee and is not

satisfied during the vesting period, any remaining expense for the award is recognised over the remaining vesting period,

unless the award is forfeited.

If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining

expense is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled

andnew award is treated as if they were a modification.

Note 34. Interests in subsidiaries

The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in

accordance with the accounting policy described in note 2:

Ownership interest

Name

Principal place

of business/

Country of

incorporation

2021

2020

Ark Technologies Pty Ltd Australia 100.00% –

Cettire, Inc. United States 100.00% 100.0%

Cettire S.R.L Italy 100.00% 100.0%

As described in note 3, Cettire Limited was incorporated on 29 October 2020. On 27 November 2020, a corporate

re-organisation in which Cettire Limited became the legal parent of Ark Technologies Pty Ltd and its subsidiaries

(the‘Pre-Existing Group’), was effected. The accounts are presented as a continuation of the Pre-Existing Group.

Note 35. Parent entity information

Set out below is the supplementary information about the parent entity.

Statement of profit or loss and other comprehensive income

Parent

2021

2020

Profit after income tax (698,028) –

Total comprehensive income (698,028) –

Cettire Annual Report 2021

Statement of financial position

Parent

2021

2020

Total current assets 33,364,806 –

Total assets 39,227,240 –

Total current liabilities 485,583 –

Total liabilities 486,156 –

Equity

Issued capital 188,344,919 –

Re-organisation reserve (148,975,401) –

Share-based payment reserve 69,594 –

Retained profits/(accumulated losses) (698,028) –

Total equity/(deficiency) 38,741,084 –

Guarantees entered into by the parent entity in relation to the debts of its subsidiaries

The parent entity had no guarantees in relation to the debts of its subsidiaries as at 30 June 2021 and 30 June 2020.

Contingent liabilities

The parent entity had no contingent liabilities as at 30 June 2021 and 30 June 2020.

Capital commitments – Property, plant and equipment

The parent entity had no capital commitments for property, plant and equipment as at 30 June 2021 and 30 June 2020.

Significant accounting policies

The accounting policies of the parent entity are consistent with those of the Group, as disclosed in note 2, except for

thefollowing:

• Investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity.

• Investments in associates are accounted for at cost, less any impairment, in the parent entity.

• Dividends received from subsidiaries are recognised as other income by the parent entity and its receipt may

beanindicator of an impairment of the investment.

Directors’ Declaration

30 June 2021

In the opinion of the Directors of Cettire Limited:

• the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards,

theCorporations Regulations 2001 and other mandatory professional reporting requirements;

• the attached financial statements and notes comply with International Financial Reporting Standards as issued

by theInternational Accounting Standards Board as described in note 2 to the financial statements;

• the attached financial statements and notes give a true and fair view of the Group’s financial position as at

30 June 2021 and of its performance for the financial year ended on that date; and

• there are reasonable grounds to believe that the parent will be able to pay its debts as and when they become

due andpayable.

The Directors have been given the declarations by the Chief Executive Officer and Chief Financial Officer as 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.

Dean Mintz

Executive Director and CEO

Kerry Robert (Bob) East

Non-Executive Director and Chair

30 August 2021

Cettire Annual Report 2021

#5890337v6

Grant Thornton Audit Pty Ltd ACN 130 913 594

subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389

‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services

to their clients

and/or refers to one or more me

mber firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International

Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity.

Services are

del

ivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one

another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term

‘Grant Thornton’ may refer to

Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to

Grant Thornton Australia Limited.

Liability limited by a scheme approved under Professional Standards Legislation.

www.grantthornton.com.au

Collins Square, Tower 5

727 Collins Street

Melbourne VIC 3008

Correspondence to:

GPO Box 4736

Melbourne VIC 3008

T +61 3 8320 2222

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E info.vic@au.gt.com

W www.grantthornton.com.au

Independent Auditor’s Report

To the Members of Cettire Limited

Report on the audit of the financial report

Opinion

We have audited the financial report of Cettire Limited (the Company) and its subsidiaries (the Group), which comprises

the consolidated statement of financial position as at 30 June 2021, the consolidated statement of profit or loss and other

comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the

year then ended, and notes to the consolidated financial statements, including a summary of significant accounting

policies, and the Directors’ declaration.

In our opinion, the accompanying financial report of 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 performance for the year

ended on that date; and

b complying with Australian Accounting Standards and the Corporations Regulations 2001.

Basis for opinion

We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are

further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are

independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and

the ethical requirements of the Accounting Professional and 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.

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

Independent Auditor’s Report

30 June 2021

Independent Auditor’s Report

Continued

#5890337v6

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 of the current period. These 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.

Key audit matter How our audit addressed the key audit matter

Revenue recognition – Note 2

As disclosed in Note 2 to the financial report, revenue is recognised

at an amount that reflects the consideration to which the Group is

expected to be entitled in exchange for transferring goods to a

customer. Revenue from the sale of goods is recognised at the point

in time when the customer obtains control of the goods, which is

generally at the time of delivery and the performance obligation is

satisfied in accordance with AASB 15 Revenue from Contracts with

Customers.

The majority of the Group’s sales transactions are completed through

the “drop-ship” model whereby suppliers deliver goods directly to the

Group’s customers. The Group is the principal in these transactions

and therefore revenue is recognised as the gross selling price net of

returns and discounts.

Revenue is only be recognised when delivery is made to the customer

which requires an assessment at the end of the reporting period for all

orders shipped but not yet delivered.

Auditing standard ASA 240 The Auditor's Responsibilities Relating to

Fraud in an Audit of a Financial Report, states that there is a presumed

fraud risk that revenue may be misstated due to improper revenue

recognition.

This area is a key audit matter due to the judgement involved in this

assessment, and the volume of online retail transactions processed on

a daily basis.

Our procedures included, amongst others:

• Reviewing revenue recognition policies and ensuring the

appropriate recognition of revenue under AASB 15;

• Performing analytical review for revenue disaggregated by month,

and where movements were outside expectations, obtaining

explanations along with corroborating documentation;

• Selecting a sample of sales transactions recorded throughout the

year and obtaining supporting documentation to validate the

occurrence of the transaction and accuracy of amounts recorded;

• Reviewing management’s cut-off assessment and calculation of

contract liabilities to evaluate whether revenue was recorded in the

correct period;

• Reviewing management’s refund provision calculation to ensure

post-year end refunds have been appropriately provided for; and

• Assessing the adequacy of associated disclosures.

Capitalised development costs – Note 13

Note 13 of the financial statements includes capitalised development

cost additions of $2.7 million to the Group’s intangible assets.

These intangible assets are being amortised over a five year period,

and an amortisation expense of $663k has been included in the

statement of profit or loss and other comprehensive income.

AASB 138 Intangible Assets sets out the specific requirements to be

met in order to capitalise development costs. Intangible assets should

be amortised over their useful economic lives in accordance with

AASB 138.

This area is a key audit matter due to subjectivity and management

judgement applied in the assessment of whether costs meet the

development phase criteria described in AASB 138, the estimate of

the assets’ useful lives and consideration of impairment involving

projected future cash flows under accounting standard AASB 136.

Our procedures included, amongst others:

• Reviewing the reconciliation of intangible assets to the general

ledger, and investigating any material variances;

• Selecting a sample of additions to the asset during the period to

evaluate whether they have been appropriately capitalised under

the criteria of AASB 138;

• Performing inquiries of management in regards to amortisation

rates used throughout the period and any changes from the prior

period;

• Recalculating amortisation expense for the period;

• Reviewing management’s assessment of impairment indicators

and evaluating the reasonableness of assumptions applied in the

assessment; and

• Assessing the adequacy of associated disclosures in line with the

requirements of AASB 138.

Cettire Annual Report 2021

#5890337v6

Key audit matter How our audit addressed the key audit matter

Accounting for Research and Development (R&D) tax

incentive - Note 18

Under the research and development (R&D) tax incentive scheme,

the Group receives a 38.5% tax offset of eligible expenditure as its

turnover is greater than $20 million per annum, provided it is not

controlled by income tax exempt entities. A registration of R&D

Activities Application is filed with AusIndustry in the following financial

year and, based on this filing, the Group receives the incentive as an

offset against its current tax payable.

Management have performed a detailed review of the Group’s total

R&D expenditure to determine the potential claim under the R&D tax

incentive legislation. The R&D offset for the period ended June 30,

2021 was $1.2 million. This represents an estimated claim for the

period from July 1, 2020 to June 30, 2021.

The Group accounts for the R&D offset under AASB 120 Accounting

for Government Grants,

whereby where R&D expenditure has been

capitalised, the Group has recognised the tax benefit as deferred

income that is recognised in profit or loss on a systematic basis

matching the useful life of the asset. Where R&D expenditure has not

been capitalised, the benefit is recognised in the period it is received.

This is a key audit matter due to the size of the receivable and

because there is a degree of judgment and interpretation of the R&D

tax legislation required to assess eligibility of the R&D expenditure

under the scheme.

Our procedures included, amongst others:

• Obtaining an understanding the process undertaken to calculate

the R&D tax incentive;

• Evaluating the competence, capabilities and objectivity of the

specialist engaged by the Group to review the R&D expenditure;

• Utilising an internal R&D tax specialist in:

o Reviewing the methodology used by the Group for

consistency with the R&D tax offset rules; and

o Considering the nature of the expenses against the eligibility

criteria of the R&D tax incentive scheme to assess whether

the expenses included in the estimate were likely to meet the

eligibility criteria;

• Inspecting supporting documentation for a sample of expenses

claimed to assess validity of the claimed amount and eligibility

against the R&D tax incentive scheme criteria;

• Comparing the nature of R&D expenditure included in the current

year estimate to the prior year claim;

• Considering the Group’s history of successful claims;

• Inspecting copies of rele

vant correspondence with AusIndustry and

the Australian Taxation Office related to the claims; and

• Assessing the adequacy of the Group’s disclosures in relation to

the R&D tax incentive.

Information other than the financial report and auditor’s report thereon

The Directors are responsible for the other information. The other information comprises the information included in the

Group’s 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 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, 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 Group’s ability 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.

Independent Auditor’s Report

Continued

#5890337v6

Auditor’s responsibilities for the audit of the financial report

Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material

misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance

is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing

Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are

considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions

of users taken on the basis of this financial report.

A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance

Standards Board website at: https://www.auasb.gov.au/auditors_responsibilites/ar1_2020.pdf. This description forms part of

our auditor’s report.

Report on the remuneration report

Opinion on the remuneration report

We have audited the Remuneration Report included in pages 15 to 22 of the Directors’ report for the year ended

30 June 2021.

In our opinion, the Remuneration Report of Cettire 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.

Grant Thornton Audit Pty Ltd

Chartered Accountants

A C Pitts

Partner – Audit & Assurance

Melbourne, 30 August 2021

Cettire Annual Report 2021

Additional Information

30 June 2021

The shareholder information set out below was applicable at 31 July 2021.

Ordinary shares

Cettire has on issue 381,238,220 fully paid ordinary shares.

Number of holders

The number of holders of ordinary equity shares was 3,916.

The number of holders of unquoted options was 1.

The number of holders of unquoted service rights was 5.

Voting rights

The voting rights attaching to each class of equity securities are set out below:

a. Ordinary shares – on a show of hands every member present at a meeting in person or by proxy shall have one vote

and upon a poll each shall have one vote.

b. Options and rights – no voting rights.

Substantial shareholders

The names of the substantial holders of the Parent and the number of equity securities in which those substantial holders

and their associates have a relevant interest, as disclosed in substantial holding notices given to the Parent, are as follows:

Name Class of securities Number held % of issued capital

Dean Mintz Ordinary shares 251,238,220 65.90%

Cat Rock Capital Master Fund LP Ordinary shares 20,827,197 5.46%

Distribution of holders of equity securities

Distribution of ordinary shareholders

Holdings Ranges Holders Total units %

1  1,000 1,636 893,799 0.23%

1,001  5,000 1,466 3,649,148 0.96%

5,001  10,000 351 2,755,441 0.72%

10,001  100,000 392 12,448,771 3.27%

100,001 – and over 71 361,491,061 94.82%

Totals 3,916 381,238,220 100.00%

Unquoted Securities

There are 2,500,000 unquoted options in issue, exercisable in 3 equal tranches at an exercise price of $1.21 per option.

The options are held by 1 holder.

There are 402,544 unquoted service rights in issue. The vesting period is 4 years from date of grant. The service rights are

held by 5 participants.

Additional Information

Continued

Number of holders holding less than a marketable parcel of ordinary shares

The number of holders holding less than a marketable parcel of ordinary shares was 187.

Twenty largest quoted equity security holders

Holder Name Balance %

Dean Mintz 251,238,220 65.90%

HSBC Custody Nominees (Australia) Limited 25,655,993 6.73%

HSBC Custody Nominees (Australia) Limited – A/C 2 24,697,085 6.48%

UBS Nominees Pty Ltd 18,859,228 4.95%

J P Morgan Nominees Australia Pty Limited 8,463,137 2.22%

T2 Capital I Pty Limited <Barnaby A/C> 3,494,330 0.92%

National Nominees Limited 2,809,781 0.74%

Citicorp Nominees Pty Limited 2,771,985 0.73%

BNP Paribas Nominees Pty Ltd <IB AU Noms Retailclient DRP> 2,737,148 0.72%

CS Third Nominees Pty Limited <HSBC Cust Nom AU Ltd 13 A/C> 2,137,924 0.56%

Truebell Capital Pty Ltd <Truebell Investment Fund> 2,010,500 0.53%

Brispot Nominees Pty Ltd <House Head Nominee A/C> 1,139,393 0.30%

East Super Pty Ltd 1,000,000 0.26%

Mr Kerry R East Family Trust & Mrs Susan Millar-East Family Trust <ACC 2> 1,000,000 0.26%

Certane CT Pty Ltd <Bipeta> 645,000 0.17%

Certane CT Pty Ltd <Charitable Foundation> 605,000 0.16%

CS Fourth Nominees Pty Limited <HSBC Cust Nom AU Ltd 11 A/C> 551,600 0.14%

Invia Custodian Pty Limited <McMurdo Fam SF A/C> 500,000 0.13%

Washington H Soul Pattinson and Company Limited 500,000 0.13%

Mandalay TST Pty Ltd <TH Investment A/C> 500,000 0.13%

Total number of shares of top 20 holders 350,816,324 92.02%

Total remaining holders balance 30,421,896 7.98%

Cettire Annual Report 2021

Escrow

Class Type of restriction Number of

securities

End of escrow period

Ordinary shares Voluntary escrow 62,809,555 The date on which the Group’s December 2021 interim

results are released (expected to be in February 2022)

Ordinary shares Voluntary escrow 62,809,555 The date on which the Group’s June 2022 final results

are released (expected to be in August 2022)

Ordinary shares Voluntary escrow 125,619,110 The date on which the Group’s December 2022 interim

results are released (expected to be in February 2023)

Other information

The Parent is not currently conducting an on-market buyback.

There are no issues of securities approved for the purposes of Item 7 of section 611 of the Corporations Act which have

not yet been completed.

No securities were purchased on-market during the reporting period under or for the purposes of an employee

incentivescheme or to satisfy the entitlements of the holders of options or other rights to acquire securities granted

underan employee incentive scheme.

Corporate Directory

Directors Kerry Robert (Bob) East (Chairman)

Bruce Rathie

Richard (Rick) Dennis

Dean Mintz

Company secretary Fiona van Wyk

Registered Office Level 40, 140 William Street, Melbourne, Vic 3000

Principal Place of Business Level 40, 140 William Street, Melbourne, Vic 3000

Auditor Grant Thornton

Collins Square, Tower 5, Level 22, 727 Collins Street, Melbourne, Vic 3008

Share Registry Automic Pty Ltd

Level 5, 126 Phillip Street, Sydney NSW 2000

Stock Exchange Listing Code ASX:CTT

Website www.cettirecorporate.com

Cettire Annual Report 2021

www.colliercreative.com.au#CET0003

Cettire Annual Report 2021

Cettire Limited ABN 75 645 474 166