Documente Academic
Documente Profesional
Documente Cultură
ACN120394194
ASXAppendix4D
RESULTSFORANNOUNCEMENTTOTHEMARKET
Currentreportingperiod:
Previouscorrespondingperiod:
Halfyearended31December2011
Halfyearended31December2010
Percentage
change
Amount
EARNINGS
UP(+)/DOWN()
$A
Revenuefromordinaryactivities
+20%
16,275,847
Revenueandotherincomefromordinaryactivities
+24%
16,924,541
Profitfromordinaryactivitiesaftertaxattributabletomembers
+28%
970,123
Netprofitfortheperiodattributabletomembers
+28%
970,123
DIVIDENDS
2012Interimdividend
Correspondingperiod
EARNINGSPERSHARE
Basicanddilutedearningspershare
Percentagechange
UP(+)/DOWN()
+12%
Amount
pershare
0.30cents
31Dec2011
0.96
31Dec2011
4.21
Frankedamount
pershare
at30%
0.30cents
31Dec2010
0.86
31Dec2010
6.98
Percentagechange
NETTANGIBLEASSETBACKING
UP(+)/DOWN()
Nettangibleassetbackingpersecurity
40%
Consolidated revenues and other income of $16,924,541 were 24% higher than the previous
corresponding halfyear period of $13,616,834 operating revenues. Revenue increased due to a
combinationoforganicandacquisitiongrowthduringtheperiod.
Thefollowingtablesummarisesresultsfortheperiod,thefullyear2011,andeachofthehalfyearsof
2011.
FirstHalf
SecondHalf
FullYear
FirstHalf
2011
2011
2011
2012
$m
$m
$m
$m
Revenueandotherincome
16.92
28.48
14.86
13.62
Netprofitaftertax
0.97
1.29
0.53
0.76
Earningspershare
0.96cents
1.41cents
0.55cents
0.86cents
INTEGRATEDLEGALHOLDINGSLIMITED
ACN120394194
ASXAppendix4D
RESULTSFORANNOUNCEMENTTOTHEMARKET
AfullercommentaryontheresultsforthereportingperiodiscontainedintheASXrelease2012First
HalfResultsAnnouncement,dated28February2012.
TheGrouphasnotdeclaredaninterimdividendwithrespecttothefinancialyearended30June2012
(2011interimdividend:0.30cents).Giventheacquisitionactivityduringthefirsthalf,thepotentialfor
furtheracquisitionannouncementsinthe2ndhalf,andrecentlydeterioratedclientpaymentterms,the
Directorshaveresolvednottodeclareaninterimdividend.
Thegroupdoesnothaveanyinterestsinassociatesoutsidethegroup,nordoesithaveanyinterestin
jointventures.
Duringtheperiod,theGroup,throughitswhollyownedsubsidiaries,gainedcontrolofthefollowing
business:
EntityName
Datecontrolgained
PLNLawyersPtyLtd
1August2011
(incorporatingPLNAdvisoryVanuatuandPLNAdvisoryFiji)
INTEGRATEDLEGALHOLDINGSLIMITED
ACN120394194
(ASX:IAW)
HalfYearFinancialReport
forthehalfyearended31December2011
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
Contents
Corporateinformation........................................................................................................................1
Directorsreport.................................................................................................................................2
Consolidatedstatementoffinancialposition.....................................................................................5
Consolidatedstatementofcomprehensiveincome...........................................................................6
Consolidatedstatementofcashflows................................................................................................7
Consolidatedstatementofchangesinequity....................................................................................8
Notestotheconsolidatedfinancialstatements.................................................................................9
Directorsdeclaration.......................................................................................................................22
Auditorsindependencedeclaration................................................................................................23
Independentauditorsreviewreport...............................................................................................24
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
CorporateInformation
ABN20120394194
Directors
TheHonJohnDawkins,Chairman
AnneTregonning,NonexecutiveDirector
GraemeFowler,ManagingDirector/ChiefExecutive
CompanySecretary
JeanMarieRudd
Registeredoffice
Level2
11MountsBayRoad
PerthWA6000
Principalplaceofbusiness
HeadOffice
Level22
1MarketStreet
SydneyNSW2000
Tel:(02)82636600
ShareRegister
ComputershareInvestorServicesPtyLimited
Level2
45StGeorgesTerrace
PerthWA6000
Tel:(08)93232000
IntegratedLegalHoldingsLimitedsharesarelistedontheAustralianStockExchange.
Solicitors
TalbotOlivier
Level8,WesfarmersHouse
40TheEsplanade
PerthWA6000
Bankers
StGeorgeBank
Level2,WestraliaPlaza
167StGeorgesTerrace
PerthWA6000
Auditor
Ernst&Young
11MountsBayRoad
PerthWA6000
ArgyleLawyers
Level22
1MarketStreet
SydneyNSW2000
NationalAustraliaBankLimited
100StGeorgesTerrace
PERTHWA6000
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
DirectorsReport
The directors of Integrated Legal Holdings Limited (the Company) submit the halfyear financial
reportforthehalfyearended31December2011.
DIRECTORS
ThenamesoftheCompanysdirectorsinofficeduringthehalfyearanduntilthedateofthisreport
aresetoutbelow.Directorswereinofficeforthisentireperiodunlessotherwisestated.
TheHonJohnDawkinsAO(NonexecutiveChairman)
AnneTregonning(NonexecutiveDirector)
GraemeFowler(ManagingDirector)
REVIEWANDRESULTSOFOPERATIONS
Consolidated revenues and other income of $16,924,541 were 24% higher than the previous
corresponding halfyear period of $13,616,834 operating revenues. Revenue increased due to a
combinationoforganicandacquisitiongrowthduringtheperiod.
Thefollowingtablesummarisesresultsfortheperiod,thefullyear2011,andeachofthehalfyears
of2011.
FirstHalf
SecondHalf
FullYear
FirstHalf
2011
2011
2011
2012
$m
$m
$m
$m
Revenueandotherincome
16.92
28.48
14.86
13.62
Netprofitaftertax
0.97
1.29
0.53
0.76
Earningspershare
0.96cents
1.41cents
0.55cents
0.86cents
A fuller commentary on the results for the reporting period is contained in the ASX release 2012
FirstHalfResultsAnnouncement,dated28February2012.
The Group has not declared an interim dividend with respect to the financial year ended 30 June
2012 (2011 interim dividend: 0.30 cents). Given the acquisition activity during the first half, the
potential for further acquisition announcements in the 2nd half, and recently deteriorated client
paymentterms,theDirectorshaveresolvednottodeclareaninterimdividend.
ACQUISITIONOFPLNLAWYERSPTYLTD
InAugust2011theCompanyannouncedtheacquisitionofPLNLawyersPtyLtd(PLN)undertuckin
arrangementswiththeexistingmemberfirmArgyleLawyersPtyLtd(Argyle).
PLNisanestablishedandhighlyregardedSydneybasedcommerciallawfirm.PLNsmissionistobe
the leading provider of legal and business advisory services to corporations and international
institutions operating in the Pacific Region. PLNs clients include Australian, Asian, American and
European based companies and financial institutions with business interests in the AsiaPacific
region.
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
DirectorsReport
PLN provides a wide range of legal services including Corporate and Financial Services, Travel and
Tourism,AviationIndustryservices,InfrastructureandDevelopment,Insurance,Insolvency,Mergers,
AcquisitionsandIPOs,MiningandPetroleum,TelecommunicationsandInformationTechnology.
PLNisthecentreofmanagementforthePacificLegalNetworkwhichwasestablishedin2002and
hasdevelopedkeyaffiliaterelationshipsinVanuatu,Fiji,PapuaNewGuinea,Samoa,NewZealand,
AmericanSamoa,Tonga,CookIslands,NewCaledonia,FrenchPolynesia,SolomonIslands,Hawaii,
theMarshallIslands,NorthernMarianaIslands,Palau,mainlandUSA,andacrossAsia.PacificLegal
Networkremainstheonlycoordinatedlegalandbusinessadvisoryserviceintheregion.
The firm consists of founder and Principal John Ridgway, Senior Associate Nitij Pal, and 4 lawyers,
withatotalof8staff,andannualfeeincomeofapproximately$2m.
PLNisanawardwinninglawfirmhavingwonthe2009NewSouthWalesExporteroftheYearAward
in a recognised services industry, and in August 2010 was named joint winner of the e.law Asia
PacificBoxBreakeroftheYearAward,whichrecognisesthosethinkingoutsidethesquaretomeet
legalbusinesschallenges.
PLN was tuckedin with existing member firm Argyle, with the combined firm having 6 Principals,
approximately40staffandannualfeeincomeofmorethan$10m.
PLNhasretaineditsbrand,butwilloperategoingforwardundertheArgylebusinessumbrella.The
tuckinarrangementspromiseasoundbaseforthegrowthandexpansionofthePLNbrandacross
AsiaPacificandviatheILHmemberfirmsinAustralia.
The Directors believe that PLN is a high quality business with strong growth prospects and will
provide both Argyle and ILH with a platform for future growth, in particular strengthening the
organisations commercial law service offerings, and providing new access to the Pacific and Asian
markets.
The Company expects to generate earnings improvements through cross referrals of client matter
opportunitiesaswellascostsynergiessuchaspremises.
TheDirectorsexpectthetransactiontobeEPSaccretiveinthe2012financialyearandwillenhance
theCompanysgrowthprospects.
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
DirectorsReport
AUDITORSINDEPENDENCEDECLARATION
A copy of the auditors independence declaration in relation to the review for the halfyear is
providedonpage24andformspartofthisreport.
Signedinaccordancewitharesolutionofthedirectors.
GFowler
ManagingDirector
Perth,28February2012
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
ConsolidatedStatementofFinancialPosition
ASSETS
Currentassets
Cashandcashequivalents
Tradeandotherreceivables
Workinprogress
Incometaxreceivable
Totalcurrentassets
Note
Consolidated
Asat
31Dec2011
$
Consolidated
Asat
30June2011
$
5
6
1,091,733
9,343,167
2,867,589
13,302,489
2,460,760
7,826,873
2,499,220
12,782
12,799,635
Noncurrentassets
Plantandequipment
Prepayments
Goodwill
Intangibleassets
Availableforsalefinancialassets
Totalnoncurrentassets
TOTALASSETS
7
8
1,387,202
14,614
14,590,139
11,880
2,781
16,006,616
29,309,105
1,170,294
14,614
12,900,557
29,700
3,435
14,118,600
26,918,235
2,844,954
484,828
54,725
1,052,337
365,327
4,802,171
3,813,598
2,536,259
986,593
255,769
7,592,219
LIABILITIES
Currentliabilities
Tradeandotherpayables
Interestbearingloansandborrowings
Incometaxpayable
Provisions
Otherliabilities
Totalcurrentliabilities
Noncurrentliabilities
Tradeandotherpayables
Interestbearingloansandborrowings
Provisions
Deferredtaxliabilities
Otherliabilities
Totalnoncurrentliabilities
TOTALLIABILITIES
NETASSETS
EQUITY
Issuedcapital
Accumulatedlosses
Reserves
TOTALEQUITY
10
10
11
12
4,791,832
386,841
185,159
244,729
5,608,561
10,410,732
18,898,373
37,554
143,325
306,092
137,038
689,344
1,313,353
8,905,572
18,012,663
33,899,828
(16,926,589)
1,925,134
18,898,373
33,397,152
(16,926,589)
1,542,100
18,012,663
TheaboveConsolidatedStatementofFinancialPositionshouldbereadinconjunctionwiththe
accompanyingnotes
5
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
ConsolidatedStatementofComprehensiveIncome
Note
Professionalfeesrevenue
Totalrevenue
Movementinfairvalueoffinancialliabilities
Interestincome
Dividendsreceived
Otherrevenue
Otherincome
Occupancyexpenses
Salariesandemployeebenefitsexpenses
Depreciationandamortisationexpenses
Officeexpenses
Advertisingandmarketingexpenses
Otherexpenses
Interestexpenses
Sharebasedpaymentsexpense
Totalexpenses
Profitbeforeincometax
Incometaxexpense
Profitafterincometax
Netprofitfortheperiod
Othercomprehensiveincome
Netgains/(losses)onavailableforsalefinancialassets
Othercomprehensiveincomefortheperiod,netoftax
Totalcomprehensiveincomefortheperiod
Basicearningspershare(cents)
Dilutedearningspershare(cents)
10
15
Consolidated
Halfyear
ended
31Dec2011
$
Consolidated
Halfyear
ended
31Dec2010
$
16,275,847 13,537,017
16,275,847 13,537,017
550,437
69,577
78,756
76
72
28,604
989
648,694
79,817
(1,414,077) (1,091,440)
(11,498,763) (8,716,908)
(240,224)
(193,400)
(1,810,991) (1,492,467)
(237,133)
(160,364)
(327,926)
(774,690)
(166,939)
(55,198)
(27,956)
(17,844)
(15,724,009) (12,502,311)
1,200,532
1,114,523
(230,409)
(358,617)
970,123
755,906
970,123
755,906
(654)
631
(654)
631
969,469
756,537
0.96
0.96
0.86
0.86
TheaboveConsolidatedStatementofComprehensiveIncomeshouldbereadinconjunctionwith
theaccompanyingnotes.
6
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
ConsolidatedStatementofCashFlows
Cashflowsfromoperatingactivities
Receiptsfromcustomers
Paymentstosuppliersandemployees
Interestreceived
Dividendsreceived
Sundryincome
Interestandothercostsoffinancepaid
Incometaxpaid
Netcashflows(usedin)/fromoperatingactivities
Cashflowsfrominvestingactivities
Purchaseofplantandequipment
Paymentfortheacquisitionofbusinesses
Proceedsfromthedisposalofplantandequipment
Netcashflowsusedininvestingactivities
Cashflowsfromfinancingactivities
Paymentforshareissueexpenses
Proceedsfromborrowings
Repaymentsofborrowings
Paymentofdividends
Netcashflows(usedin)/fromfinancingactivities
Netincrease/(decrease)incashheld
Cashandcashequivalentsatthebeginningofthe
period
Cashandcashequivalentsattheendoftheperiod
Consolidated
Halfyear
ended
31Dec2011
$
Note
14
Consolidated
Halfyear
ended
31Dec2010
$
15,753,614
(17,431,140)
69,577
76
28,604
(101,824)
(113,980)
(1,795,073)
(427,024)
(1,253,614)
-
(1,680,638)
(12,979)
2,940,337
(489,304)
(448,735)
1,989,319
(1,486,392)
15,171,446
(13,950,215)
78,756
72
989
(29,210)
(242,608)
1,029,230
2,435,615
949,223
1,948,949
2,092,718
(147,166)
(147,166)
(3,674)
(293,065)
(441,556)
(738,295)
143,769
TheaboveConsolidatedStatementofCashFlowsshouldbereadinconjunctionwiththe
accompanyingnotes.
7
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
ConsolidatedStatementofChangesinEquity
CONSOLIDATED
At1July2010
Profitfortheperiod
Othercomprehensive
income
Totalcomprehensive
incomefortheperiod
Transactionswithowners
intheircapacityasowners
Dividendspaid
Transfertogeneralreserve
Sharesissued
Transactioncostsonshare
issue
Sharebasedpayments
Balanceasat31December
2010
CONSOLIDATED
At1July2011
Profitfortheperiod
Othercomprehensiveloss
Totalcomprehensive
incomefortheperiod
Transactionswithowners
intheircapacityasowners
Dividendspaid
Sharesissued
Transactioncostsonshare
issue
Sharebasedpayments
Balanceasat31December
2011
Issued
Capital
$
32,160,426
Net
Unrealised
Accumulated
GainsReserve
Losses
$
$
(16,688,184)
(1,441)
755,906
195,000
(3,674)
17,844
32,369,596
Issued
Capital
$
33,397,152
General
Reserve
$
727,113
Total
Equity
$
16,197,914
755,906
631
631
755,906
631
756,537
238,405
(441,556)
195,000
(441,556)
(238,405)
(3,674)
17,844
(810)
965,518
16,722,065
Net
Unrealised
Accumulated
GainsReserve
Losses
$
$
(16,926,589)
(649)
General
Reserve
$
1,542,749
Total
Equity
$
18,012,663
(16,612,239)
(654)
970,123
970,123
(654)
(654)
970,123
969,469
(586,435)
(586,435)
487,700
487,700
(12,980)
27,956
33,899,828
(16,926,589)
(1,303)
(12,980)
27,956
1,926,437
18,898,373
TheaboveConsolidatedStatementofChangesinEquityshouldbereadinconjunctionwiththe
accompanyingnotes.
8
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
NotestotheConsolidatedFinancialStatements
1) CORPORATEINFORMATION
ThegeneralpurposecondensedfinancialreportofIntegratedLegalHoldingsLimited(theCompany)
forthehalfyearended31December2011wasauthorisedforissueinaccordancewitharesolution
oftheDirectorson28February2012.IntegratedLegalHoldingsLimitedisacompanyincorporated
inAustraliaandlimitedbyshares,whicharepubliclytradedontheAustralianStockExchange(ASX).
2) BASISOFPREPARATIONANDACCOUNTINGPOLICIES
Basisofpreparation
This general purpose condensed financial report for the halfyear ended 31 December 2011 has
been prepared in accordance with AASB 134 Interim Financial Reporting and the Corporations Act
2001.
The halfyear financial report does not include all notes of the type normally included within the
annualfinancialreportandthereforecannotbeexpectedtoprovideasfullanunderstandingofthe
financial performance, financial position and financing and investing activities of the consolidated
entityasthefullfinancialreport.
Itisrecommendedthatthehalfyearfinancialreportbereadinconjunctionwiththeannualreport
fortheyearended30June2011andconsideredtogetherwithanypublicannouncementsmadeby
IntegratedLegalHoldingsLimitedanditscontrolledentities(theGroup)duringthehalfyearended
31December2011inaccordancewiththecontinuousdisclosureobligationsundertheASXListing
Rules.
ThehalfyearfinancialreportispreparedinAustraliandollarsandonahistoricalcostbasis,except
foravailableforsaleinvestments,whichhavebeenmeasuredatfairvalue.
For the purposes of preparing the halfyear financial report, the halfyear has been treated as a
discretereportingperiod.
Significantaccountingpolicies
Apartfromthechangesinaccountingpolicynotedbelow,theaccountingpoliciesand methodsof
computationarethesameasthoseadoptedinthemostrecentannualfinancialstatements.
Changesinaccountingpolicy
From 1 July 2011, the Group has adopted all Australian Accounting Standards and Interpretations,
mandatoryforannualperiodsbeginningonorafter1July2011.Adoptionofthesestandardsand
interpretationsdidnothaveaneffectonthefinancialpositionorperformanceoftheGroup.
Basisofconsolidation
The halfyear consolidated financial statements comprise the financial statements of Integrated
LegalHoldingsLimitedanditssubsidiariesasat31December2011.
Subsidiariesareallthoseentities(includingspecialpurposeentities)overwhichtheGrouphasthe
power to govern the financial and operating policies so as to obtain benefits from their activities.
9
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
NotestotheConsolidatedFinancialStatements
Theexistenceandeffectofpotentialvotingrightsthatarecurrentlyexercisableorconvertibleare
consideredwhenassessingwhetheragroupcontrolsanotherentity.
The financial statements of the subsidiaries are prepared for the same reporting period as the
parentcompany,usingconsistentaccountingpolicies.
In preparing the consolidated financial statements, all intercompany balances and transactions,
income and expenses and profit and losses resulting from intragroup transactions have been
eliminatedinfull.
Subsidiaries are fully consolidated from the date on which control is obtained by the Group and
ceasetobeconsolidatedfromthedateonwhichcontrolistransferredoutoftheGroup.
3) SEGMENTINFORMATION
Operatingsegments
Theaccountingpoliciesusedbythe Groupinreportingsegmentsinternallyarethesame asthose
containedinnote2totheaccounts.TheIntegratedLegalHoldingsGrouphasidentifieditsoperating
segmentsbasedontheinternalmanagementreportingthatisusedbytheexecutivemanagement
team(thechiefoperatingdecisionmaker)inassessingperformanceandallocatingresources.
IntegratedLegalHoldingsoperatingsegmentshavebeenidentifiedbasedonhowthefinancialand
operatingresultsoftheGrouparemonitoredandpresentedinternallytotheexecutivemanagement
team. The reportable segments are based on aggregated operating segments determined by the
similarity of the products sold and the services provided, as these are the sources of the Groups
majorrisksandhavethemosteffectontheratesofreturn.
Fortheyearended30June2011,managementidentifiedaLegalServicesDivisionandInformation
TechnologyDivisionasoperatingsegments.Changestohowthefinancialandoperatingresultsof
theGrouparemonitoredandpresentedinternallyduringthehalfyearended31December2011
haveresultedintheseDivisionsbeingdissolvedandtheGroupisnowsegmentedintoone
reportablesegment.
ArgyleLawyers,CivicLegal,SignetLawyers,TalbotOlivierandIntegratedLegalHoldingsHeadOffice
DivisionareoperatingsegmentswithinthelegalservicessectorintheAustralianmarketandhave
beenaggregatedtoonereportablesegmentgiventhesimilarityoftheservicesprovided,methodin
whichservicesaredelivered,typesofcustomersandregulatoryenvironment.
AstheGroupisaggregatedintoonereportablesegment,therearenointersegmenttransactions.
10
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
NotestotheConsolidatedFinancialStatements
4) OTHERREVENUE
Consolidated
Halfyear
ended
31Dec2011
$
Sundryincome
Consolidated
Halfyear
ended
31Dec2010
$
28,604
5) CASHANDCASHEQUIVALENTS
Cashatbankandinhand
Consolidated
At
31Dec2011
$
989
Consolidated
At
30Jun2011
$
1,091,733
2,460,760
Reconciliationtostatementofcashflows
Forthepurposesofthestatementofcashflows,cashandcash
equivalentscomprisethefollowingat31December:
Cashatbankandinhand
Shorttermdeposits
Bankoverdrafts
6) TRADEANDOTHERRECEIVABLES
CURRENT
Tradereceivables
Allowanceforimpairmentloss(a)
Unbilledclientdisbursements
Prepayments
Otherreceivables
Consolidated
Halfyear
ended
31Dec2011
$
Consolidated
Halfyear
ended
31Dec2010
$
1,087,538
4,195
(142,510)
949,223
Consolidated
At
31Dec2011
$
9,078,502
(318,942)
8,759,560
(138,757)
692,758
29,606
9,343,167
2,118,898
(26,180)
2,092,718
Consolidated
At
30Jun2011
$
7,042,390
(419,696)
6,622,694
235,537
942,059
26,583
7,826,873
11
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
NotestotheConsolidatedFinancialStatements
a) Allowanceforimpairmentloss
Trade receivables are generally noninterest bearing and are generally on 3060 day terms. An
allowance for impairment loss is recognised when there is objective evidence that an individual
trade receivable is impaired. An impairment loss of $49,032 (30 June 2011: $930,772 and 31
December2010:$551,497)hasbeenrecognisedbytheGroupinthecurrentperiodwhichincludes
bad debts expense recognised of $149,786 (30 June 2011: $644,082 and 31 December 2010:
$172,485)andadoubtfuldebtexpense/(writeback)of($100,754)(30June2011:$286,690and31
December 2010: $379,012). These amounts have been recognised in the statement of
comprehensiveincomeinthelineitemotherexpenses.
Movementsintheallowanceforimpairmentlosswereasfollows:
Consolidated
Consolidated
At
31Dec2011
$
419,696
(100,754)
318,942
Openingbalanceatthebeginningoftheperiod
Chargefortheperiod
Closingbalanceattheendoftheperiod
7) GOODWILL
Openingbalance
Acquisitionofsubsidiary(note14)
Other(1)
Closingbalance
Consolidated
At
31Dec2011
$
12,900,557
1,689,582
14,590,139
Consolidated
At
30Jun2011
$
10,470,600
2,417,757
12,200
12,900,557
At
30Jun2011
$
133,006
286,690
419,696
Consolidated
At
31Dec2010
$
10,470,600
10,470,600
i)
RelatestotheacquisitionofTheArgylePartnership.
b) DescriptionoftheGroupsgoodwill
After initial recognition, goodwill acquired in a business combination is measured at cost less any
accumulatedimpairmentlosses.Goodwillisnotamortisedbutissubjecttoimpairmenttestingon
anannualbasisorwheneverthereisanindicationofimpairment.
12
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
NotestotheConsolidatedFinancialStatements
8) INTANGIBLEASSETS
a) Reconciliationofcarryingamountsatthebeginningandendoftheperiod
Consolidated
Consolidated
Openingbalance
(netofaccumulatedamortisation)
Amortisation
Closingbalance
(netofaccumulatedamortisation)
At
31Dec2011
$
At
30Jun2011
$
Consolidated
At
31Dec2010
$
29,700
(17,820)
65,340
(35,640)
65,340
(17,820)
11,880
29,700
47,520
Cost(grosscarryingamount)
Accumulatedamortisation
Netcarryingamountattheendoftheperiod
Consolidated
At
31Dec2011
$
Consolidated
At
30Jun2011
$
Consolidated
At
31Dec2010
$
163,254
(151,374)
163,254
(133,554)
163,254
(115,734)
11,880
29,700
47,520
b) DescriptionoftheGroupsidentifiedintangibleassets
Intangibleassetsrepresentthevalueofleasedpremisesacquiredupontheacquisitionofthelegal
practice of Peter Marks in the 30 June 2008 financial year and is carried at cost less accumulated
amortisation.Thisintangibleassethasbeenassessedashavingafinitelifeandisamortisedusing
the straight line method over the remaining term of the lease. The amortisation has been
recognised in the statement of comprehensive income in the line item depreciation and
amortisationexpenses.
13
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
NotestotheConsolidatedFinancialStatements
9) INTERESTBEARINGLOANSANDBORROWINGS
CURRENT
Bankoverdraft
Obligationsunderfinanceleasesandhirepurchasecontracts
Insurancepremiumfunding(unsecured)
Bankloan(secured)
NONCURRENT
Obligationsunderfinanceleasesandhirepurchasecontracts
Bankloan(secured)
Consolidated
At
31Dec2011
$
Consolidated
At
30Jun2011
$
142,510
208,044
134,274
484,828
25,145
174,869
386,245
1,950,000
2,536,259
243,095
4,548,737
4,791,832
143,325
143,325
ThebankloanissecuredovertheassetsofIntegratedLegalHoldingsanditscontrolledentities.The
newfacilityisaCommercialBillAcceptancewithafacilitylimitof$7.0mexpiringinDecember2014.
Thishasbeendrawndownby$4.5mat31December2011.
14
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
NotestotheConsolidatedFinancialStatements
10) OTHERLIABILITIES
Consolidated
At
31Dec2011
$
CURRENT
Deferredconsiderationpayable(1)
Contingentconsiderationobligation(2)
Leaseincentiveobligation(3)
NONCURRENT
Contingentconsiderationobligation(2)
Leaseincentiveobligation(3)
Consolidated
At
30Jun2011
$
240,908
19,666
104,753
365,327
125,000
48,280
82,489
255,769
244,729
244,729
522,255
167,089
689,344
(1)DeferredconsiderationpayableontheacquisitionofPLNLawyers(seenote14)(2011:deferredconsiderationpayable
ontheacquisitionofWojtowiczKellyLegal)
(2)ContingentconsiderationpayableontheacquisitionofWojtowiczKellyLegal.
FinancialLiabilityforthecontingentconsiderationasof30June2011
522,255
Interestaccretionforthehalfyearto31December2011
28,182
Fairvalueadjustmentat31December2011
(550,437)
Closingbalanceat31December2011
(3) Operating lease incentives are recognised as a liability when received and subsequently reduced by allocating lease
paymentsbetweenrentalexpenseandreductionoftheliabilitytoensurerentalexpenseisrecognisedonastraight
linebasisovertheleaseterm.
11) ISSUEDCAPITAL
a) Ordinaryshares
Fullypaidshares
Partlypaidshares(1)
Forfeitedsharesheldintrust(2)
Consolidated
31Dec2011
Shares
100,203,515
1,831,000
102,034,515
Consolidated
30Jun2011
Shares
95,908,111
1,256,217
97,164,328
Consolidated
31Dec2011
$
33,796,377
103,451
33,899,828
Consolidated
30Jun2011
$
33,321,656
75,496
33,397,152
(1)SharesissuedundertheDeferredEmployeeSharePlanthatvestoverthreeyears(note15).
(2)SharesissuedbutforfeitedundertheDeferredEmployeeSharePlan,heldintrust(note15).
15
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
NotestotheConsolidatedFinancialStatements
Movementsinordinarysharecapital
Consolidated
Openingbalanceasat1July2011
Shares
97,164,328
33,397,152
IssueofsharesundertheDeferredEmployeeSharePlan(refer
note15)
574,783
27,956
3,043,478
350,000
IssueofsharesundertheDividendReinvestmentPlan
1,251,926
137,700
Costsassociatedwithissuingshares
Balanceasat31December2011
(12,980)
102,034,515
33,899,828
Consolidated
Openingbalanceasat1July2010
86,484,666
32,160,426
IssueofsharesundertheDeferredEmployeeSharePlan(refer
note15)
484,550
17,844
Issueofsharesat10centspersharetovendorsofTheArgyle
Partnership Lawyers in final satisfaction of deferred
considerationpayableon22September2010
1,800,000
180,000
125,000
15,000
(3,674)
88,894,216
32,369,596
Costsassociatedwithissuingshares
Balanceasat31December2010
Shares
16
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
NotestotheConsolidatedFinancialStatements
12) RESERVES
Netlossesonavailableforsalefinancialassets(a)
Generalreserve(b)
Consolidated
At
31Dec2011
$
(1,303)
1,926,437
1,925,134
Consolidated
At
30Jun2011
$
(649)
1,542,749
1,542,100
a) Netunrealisedgainsreserve
Thisreserverecordsmovementsinthefairvalueofavailableforsalefinancialassets.
b) Generalreserve
Due to accumulated losses incurred prior to the listing of the company on 17 August 2007, the
Directors resolved to isolate profits derived from trading activities since listing through the
establishmentofaGeneralReserve.
Duringtheperiod,$Nil,representingtradingprofitsfortheyearended30June2011lessdividends
paid, was transferred to the General Reserve from Accumulated Losses (31 December 2010:
$238,405).
13) CONTINGENTLIABILITIESANDCONTINGENTASSETS
Therearenocontingentliabilitiesorassetsasat31December2011.
17
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
NotestotheConsolidatedFinancialStatements
14) BUSINESSCOMBINATIONS
AcquisitionofPLNLawyersPtyLtd
Effective 1 August 2011, Integrated Legal Holdings Limited acquired the legal business of PLN
LawyersPtyLtdundertuckinarrangementswiththeexistingmemberfirmArgyleLawyersPtyLtd.
TheacquisitionsupportstheCompanysbusinessstrategytoidentifyqualitylegalbusinessestojoin
theGroupthroughacquisition,andsupportthesebusinessesaspartofanetworktowardsabove
marketgrowth,improvedbusinessperformanceandGroupsynergies.
Theconsiderationfortheacquisitionwasacombinationofcashplus3,043,478sharesat11.5cents
pershare,andincludesadeferredcashcomponentpayableinSeptember2012subjecttothePLN
businessachievingrevenueandprofitabilitytargetsfortheperiodto30June2012.Theacquisition
is structured with significant employment restraints and conditions. The cash component of the
purchaseconsiderationhasbeenfundedfromsurpluscashreserves.
Thefollowingconstitutestheprovisionalcalculationoftheconsiderationgivenandthefairvalueof
netassetsacquired:
$
Consideration
Cash
1,100,000
Deferredcashconsideration
232,653
Totalcashconsideration
1,332,653
Sharesissuedatfairvalue
350,000
Totalacquisitioncost
1,682,653
Carrying
Fair
Amount
Value
$
$
Netassetsacquired
Assets
Plantandequipment
34,860
34,860
Accumulateddepreciation
(22,573)
(22,573)
Netdeferredtaxasset
6,005
Totalassetsacquired
18,292
12,287
Liabilities
Provisionforemployeeentitlements
20,017
20,017
Netdeferredtaxliability
5,204
Totalliabilitiesacquired
25,221
20,017
Netliabilitiesacquired
(6,969)
(7,730)
Goodwillonacquisition
1,689,582
As the integration of the business is still occurring, the fair value of net assets acquired remains
provisionallydetermined.
18
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
NotestotheConsolidatedFinancialStatements
TheacquireescontributiontothenetprofitoftheGroupcannotbedeterminedasthisbusinesshas
been incorporated into Argyles business, and it is impracticable to disclose the total revenue and
profit for the combined entity as though the acquisition had taken place at the beginning of the
period.
$
Cash outflows during the period ended 31 December 2011 relate to acquisitions
wereasfollows:
PLNLawyersPtyLtd(1August2011)
Cashconsideration
1,100,000
WojtowiczKellyLegal(1February2011)
Deferredcashconsideration
153,614
Netconsolidatedcashoutflow
1,253,614
15) SHAREBASEDPAYMENTS
a) Recognisedsharebasedpaymentsexpense
The expense recognised for employee services received during the halfyear is shown in the table
below:
Consolidated
Consolidated
31Dec2011
31Dec2010
$
$
Expensearisingfromequitysettledsharebasedtransactions
27,956
17,844
b) Typesofsharebasedpaymentplans
Taxexemptemployeeshareplan(TEESP)
AllemployeesareeligibletoparticipateintheTEESPiftheymeetthefollowingcriteria:
i.
TheyareapermanentfulltimeorpermanentparttimeemployeeoftheGroup;
ii.
Theyhavemettheprobationperiodunderthetermsoftheiremploymentcontract;
iii.
Theyareatleast18yearsofage;and
iv.
TheyareanAustralianresidentfortaxpurposes.
EmployeeswhoparticipateintheTEESPcannominatetocontributeupto$1,000perannumfrom
their pretax wages or salary by way of an effective salary sacrifice towards acquiring fully paid
ordinarysharesintheCompany.
19
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
NotestotheConsolidatedFinancialStatements
InaccordancewiththerulesoftheTEESP,sharesacquiredundertheplanmustnotbewithdrawnor
otherwise dealt with, commencing from the date the employee acquires a beneficial interest in
thosesharesuntiltheearliestofthedatethat:
i.
Isthreeyearsaftertheacquisitiondate;or
ii.
TheemployeeceasestobeanemployeeoftheGroup.
The rules of the TEESP do not contain any provisions that could result in an employee forfeiting
ownershipofsharesundertheplan.
Deferredemployeeshareplan(DESP)
Shares are granted to key employees and directors of the Group. The DESP is designed to align
participantsinterestswiththoseofshareholdersbyincreasingthevalueoftheCompanysshares.
EmployeesareeligibletoparticipateintheDESPiftheymeetthefollowingcriteria:
i.
TheyareapermanentfulltimeorpermanentparttimeemployeeoftheGroup;
ii.
Theyhavemettheprobationperiodunderthetermsoftheiremploymentcontract;
iii.
Theyareatleast18yearsofage;and
iv.
TheyareanAustralianresidentfortaxpurposes.
UndertheDESP,senioremployeesareinvitedtoreceivefullypaidordinarysharesintheCompany
subject to the achievement of a number of key performance indicators such as contribution to
earningspersharefortheGroup.
SharesmayeitherbeacquiredonmarketbytheGrouporissuedbytheParent.Duringthehalfyear
ended 31 December 2011, 574,783 shares (30 June 2011: 484,550 shares) were granted by the
Parent with the cost being expensed over a vesting period of three years. The fair value of the
sharesissetatthemarketpriceofthesharesonthedateofgrant.Theimpactontheprofitandloss
forthehalfyearended31December2011is$27,956(31December2010:$17,844).
Whenaparticipantceasesemploymentpriortothevestingoftheirshares,thesharesareforfeited
in full unless otherwise determined by the Board. In the event of a change of control, the
performance period end date will be brought forward to the date of the change of control and
awardswillvestsubjecttoperformanceoverthisshortenedperiod.
Therearenocashsettlementalternatives.
20
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
NotestotheConsolidatedFinancialStatements
c) SummaryofsharesgrantedunderTEESPandDESParrangements
NosharesweregrantedundertheTEESPduringthehalfyearended31December2011.
The following table illustrates the number of and movements in shares granted during the period
undertheTEESPandtheDESP:
Consolidated
Consolidated
31Dec2011
31Dec2010
No.
No.
TEESP:
Openingbalanceat1July
252,672
252,672
(1)
Transferredtodepartedemployeesduringtheperiod
Closingbalanceasat31December
252,672
252,672
DESP:
Openingbalanceat1July
Grantedduringtheperiod
Closingbalanceasat31December
1,256,217
574,783
1,831,000
371,667
484,550
856,217
(1) Shares are transferred out of an employee trust into the employees name on termination of
employment.
d) Weightedaverageremainingvestingperiod
Theweightedaverageremainingvestingperiodasat31December2011forthesharesissuedunder
theDESPis1.68years(30June2011:1.66years).
e) Weightedaveragefairvalue
Asat31December2011,theweightedaveragefairvalueofsharesgrantedundertheDESPwas10.9
cents(30June2011:11.7cents).
21
INTEGRATEDLEGALHOLDINGSLIMITED
FINANCIALREPORTFORTHEHALFYEARENDED
31DECEMBER2011
ACN120394194
DirectorsDeclaration
InaccordancewitharesolutionoftheDirectorsofIntegratedLegalHoldingsLimited,Istatethat:
Intheopinionofthedirectors:
a. Thefinancialstatementsandnotesoftheconsolidatedentityareinaccordancewiththe
CorporationsAct2001,including:
i. Givingatrueandfairviewoftheconsolidatedentitysfinancialpositionasat31
December2011andtheperformanceforthehalfyearendedonthatdateofthe
consolidatedentity
ii. ComplyingwithAccountingStandardAASB134InterimFinancialReportingand
theCorporationsRegulations2001
b. Therearereasonablegroundstobelievethatthecompanywillbeabletopayitsdebts
asandwhentheybecomedueandpayable.
OnbehalfoftheBoard
GFowler
Director
Perth,28February2012
22
T G Dachs
Partner
Perth
28 February 2012
Auditors Responsibility
Our responsibility is to express a conclusion on the half-year condensed financial report based on our
review. We conducted our review in accordance with Auditing Standard on Review Engagements ASRE
2410 Review of a Financial Report Performed by the Independent Auditor of the Entity, in order to state
whether, on the basis of the procedures described, we have become aware of any matter that makes us
believe that the financial report is not in accordance with the Corporations Act 2001 including: giving a
true and fair view of the consolidated entitys financial position as at 31 December 2011 and its
performance for the half-year ended on that date; and complying with Accounting Standard AASB 134
Interim Financial Reporting and the Corporations Regulations 2001 . As the auditor of Integrated Legal
Holdings Limited and the entities it controlled during the half-year, ASRE 2410 requires that we comply
with the ethical requirements relevant to the audit of the annual financial report.
A review of a half-year condensed financial report consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and other review procedures. A
review is substantially less in scope than an audit conducted in accordance with Australian Auditing
Standards and consequently does not enable us to obtain assurance that we would become aware of all
significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Independence
In conducting our review, we have complied with the independence requirements of the Corporations Act
2001. We have given to the directors of the company a written Auditors Independence Declaration.
Conclusion
Based on our review, which is not an audit, we have not become aware of any matter that makes us
believe that the half-year condensed financial report of Integrated Legal Holdings Limited is not in
accordance with the Corporations Act 2001, including:
a) giving a true and fair view of the consolidated entitys financial position as at 31 December 2011 and
of its performance for the half-year ended on that date; and
b) complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations
Regulations 2001.
T G Dachs
Partner
Perth
28 February 2012
TD;SS:ILH:005