MOTORCYCLE
HOLDINGS L IM ITED
ANNUAL REPORT 2020
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2
Contents
04
Chair’s Report

06
Managing Director’s Report

10
Directors’ Report

26
Lead Auditor’s
Independence Declaration

28
Consolidated Statement of Profit or
Loss and Other Comprehensive Income

29
Consolidated Statement of
Financial Position

30
Consolidated Statement of
Changes in Equity

31
Consolidated Statement of Cash Flows

32
Notes to and Forming Part of the
Consolidated Financial Statements
67
Directors’ Declaration
68
Independent Auditor’s Report
74
Additional Information
77
Corporate Directory
MotorCycle Holdings Limited (MTO:ASX) performed strongly during
the year in challenging conditions, driven by a solid increase in
demand for new and used motorcycles, a lower cost structure,
expanded product offering and improved dealer network.
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Chair’s Report
MotorCycle Holdings Limited (ASX: MTO), achieved a strong
performance for the year to 30 June 2020 driven by a solid
increase in sales for new and used bikes, a lower cost structure,
expanded product offering, improved dealer network and
COVID-19 government support programs.
The financial year was characterised by challenging trading
conditions, however the company’s performance in the last
quarter exceeded expectations and was primarily driven by a
sales resurgence in recreation and leisure products on the back
of COVID-19 restrictions.
Due to the improved trading conditions, your Directors have
decided to declare a special dividend of 5 cents per share.
Directors have not declared an ordinary dividend and intend
to maintain strong cash reserves to protect against short term
volatility and provide capacity for opportunities that may arise.
Key features of the company’s financial performance for the
year included sales revenue increasing 10.3% to $363,712,000
(2019: $329,887,000) with Underlying EBITDA increasing 53.6% to
$27,617,000 (2019: $17,985,000).
The company ended the year in a strong cash position increasing
to $39,494,000 from $9,175,000 in 2019, so we have taken the
opportunity to pay down debt by $20,000,000 in August.
Net Profit after Tax and before impairment increased 81.9% to
$15,176,000 up from $8,345,000 for the previous year.
We decided to take a non-cash impairment of $24,296,000
against the carrying value of the wholesale segment’s intangible
assets, principally goodwill from the Cassons acquisition. There is
no impact on the company’s debt facilities or compliance with our
banking covenants as an outcome of this impairment.
This non-cash impairment impacted our profit result resulting
in a net loss after tax of $9,120,000.
Operationally, the company continued to outperform the market
with overall motorcycle sales, including both new and used
motorcycles, increasing 13.8% to 21,095 units for the year ended
30 June 2020, up from 18,536 units achieved in the previous year.
New motorcycle sales increased 16.3% to 11,013 units (2019:
9,468 units), compared with the national market increase in
new motorcycle sales of approximately 11.1%. Like for like new
motorcycle sales increased 7.5%.
The company grew its market share by securing approximately
11.1% of national new bike sales during the financial year,
compared with 10.6% in the prior year.
Used motorcycles sales increased 11.2% to 10,082 units (2019:
9,068 units) with sales improving across all brands.
Retail accessories and parts revenue increased 4.1% and servicing
and repair revenue increased 5.9%. Finance, insurance and
mechanical protection plan income increased 5.8%.
Cassons maintained profitability despite the challenging
market and while there was pressure on margins, this business’
performance improved in the second half with sales up 7.4% for
the year. While good progress was made in reducing operating
expenses and excess accessory stock throughout the year,
Directors decided to book a non cash stock obsolescence charge
of $591,000 against excess inventory.
There is no doubt the company’s strategy for the past three
years of growth through acquisitions has diversified our revenue
streams and strengthened the resilience of the company, which
has been a crucial factor in enabling it to withstand the current
uncertain trading conditions.
The company’s solid performance in this year’s challenging
environment is an outcome of the management team’s agile
response to these uncertain market conditions combined
with a disciplined focus on improving operational productivity
and lowering the company’s cost structure and driving sales
performance across the network.
We employ more than 700 staff nationally who have been
instrumental in delivering this strong performance, while also
successfully integrating new dealerships into the business.
David
Foster
CHA IR
The company’s focus for this forthcoming year will be to
continue to improve the productivity of its dealerships, drive new
bike sales with additional brands, add additional suppliers to the
wholesale distribution business, and continue to improve its online
sales presence.
Your Directors are cautiously optimistic about the forthcoming
year due to the renewed interest in motorcycles as a great
leisure product however the current heightened sales demand
momentum is expected to temper particularly if there are future
shutdowns driven by the COVID-19 pandemic.
I would like to sincerely thank the company’s management team
and employees for their commitment, as well as our shareholders
and customers for their continued support as we drive the
business forward during these uncertain times.





David Foster
Chair
Due to the improved trading conditions,
your Directors have decided to declare a
special dividend of 5 cents per share.
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Managing Director’s Report
Without doubt financial year 2020 has been a most challenging
year. With motorcycle sales falling for most of the year we went
into the COVID-19 pandemic with considerable concern. I am pleased
to confirm that we were able to expand the network, reduce costs
extensively across the group, and significantly grow our underlying
EBITDA and profit after tax for the year. Importantly, we were able to
improve our net debt position considerably and finished the year with
$39,494,000 in cash, up from $9,175,000 the previous year.
These results have come from a tremendous effort by our
management team and staff, and I must say that I couldn’t be
prouder of their achievements during these trying times.
In late March early April, we saw a dramatic slow down in sales.
Virtually overnight our sales reduced by 50%. We took immediate
and significant action to protect the business from the sudden
change in conditions. These actions not only helped to limit the
immediate impact to profitability, but also to set us up to benefit
from the upturn in sales that we saw in May and June.
Aggressive cost savings, both before and during the COVID-19 crisis,
combined with aggressive marketing and JobKeeper assistance,
all helped to achieve an exceptional result, given the challenging
circumstances.
Despite the immediate challenges we continued to expand the
network by adding six new Indian dealerships to our existing sites,
and building and relocating a new Harley Davidson dealership in
Melbourne, in the second half. Two new dealerships were added to
the network in the first half of the year, Northside Harley Davidson
in Melbourne, and Canberra Motorcycle Centre. Both additions
performed well and have exceeded our expectations so far.
We have continued to increase our offering in the recreational, leisure
and agricultural markets, by adding Polaris Off Road vehicles to two
of our Sydney MCAS locations, as well as Yamaha WaveRunners and
Stihl power products to our Cairns dealership.
Despite the difficult trading conditions, we were able to grow new
motorcycle sales by 16.3% to 11,013 units, which increased our market
share to 11.1% of the total market, up from 10.6% the previous year.
Used motorcycle sales grew by 11.2% to 10,082 units. Both divisions
saw an increase in retained margins and a considerable increase in
gross profit.
External wholesale accessories sales through Cassons grew by 7.4%
but profit was impacted by unfavourable exchange rates and an
additional write down of excess stock. Retail accessories grew by
4.1% with gross down 2.7%.
Service gross grew by 5.8% and retail finance and insurance
commission by 5.1%. Our wholesale finance investment in the
joint venture with Allied Credit has had to increase provisions for
potential losses due to COVID-19 and is now expected to return a
profit in FY21.
Over the course of the year we continued our program of
refurbishing dealerships as required and invested in new showrooms
to cater for new brands added to the group.
Despite the partial closure of six of our Victorian dealerships in
recent weeks we are still cautiously optimistic of growing the
business group. Our broad product offering and diversified
geographical locations, combined with a renewed interest in leisure
products and a lower cost base, gives us reason to believe that
we can continue to grow the business. Significant sales in entry
level motorcycles will help to create demand in future years as
customers move up to larger models.
It is still of course a very changeable market, but we believe we have
an agile management team that is capable of moving quickly to not
only protect the business going forward, but also of taking advantage
of the opportunities as they arise.





David Ahmet
Managing Director
David
Ahmet
MANAGING
D IRECTOR
“Despite the difficult trading
conditions, we were able to grow
new motorcycle sales by 16.3% to
11,013 units, which increased our
market share to 11.1% of the
total market, up from 10.6%
the previous year.”
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Results and Operational Overview
Revenue increased
10.3% to $363,712,000
(2019: $329,887,000)
Underlying EBITDA increased
53.6% to $27,617,000
(2019: $17,985,000)
Special dividend of 5
cents per share declared
amounting to $3,085,000
Cash position increased
strongly to $39,494,000
(2019: $9,175,000)
Total motorcycle sales
increased 13.8% to 21,095
units (2019: 18,536 units)
National market share for
new bike sales grew to
approx 11.1% from 10.6%
New motorcycle sales
increased 16.3% to 11,013
units (2019: 9,468 units)
Used motorcycles sales
increased 11.2% to 10,082
units (2019: 9,068 units)
Added 6 Indian, 2 Polaris,
2 Husqvarna, 4 Royal Enfield,
Peugeot, and Benelli
showrooms to MCA
and TeamMoto stores
Now sell 16 top global
motorcycle brands
Net Profit after Tax
and before impairment
increased 81.9% to $15,176,000
(2019: $8,345,000)
Non cash impairment of
$24,296,000 recognised on
goodwill from Cassons acquisition
> >
> >
> >
“Despite the immediate
challenges we continued to
expand the network by adding
six new Indian dealerships
to our existing sites...”
11
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The directors present their report together with the consolidated financial statements of MotorCycle Holdings Limited (‘the Company’)
and its controlled entities (‘the Group’) for the year ended 30 June 2020 and the auditor’s report thereon.
Directors
The directors of the Company at any time during or since the end of the financial year are:
DAVID FOSTER Chair, Independent Non-Executive Director
• Appointed 8 March 2016
(Non-Executive Director)
• Appointed 22 July 2016
(Interim Chair)
• Appointed 23 August
2016 (Chair)
David has over 25 years’ experience in the financial services
industry, with experience spanning across management, distribution,
technology and marketing in retail banking.
David is currently a non-executive director of Genworth Mortgage
Insurance Australia Limited, G8 Education and Bendigo and Adelaide
Bank Limited and was previously CEO of Suncorp Bank. David has a
Master of Business Administration, a Bachelor of Applied Science, is
a Senior Fellow with Financial Services Institute of Australasia and a
Graduate of the Australian Institute of Company Directors.
Current Directorships of Other Listed Entities • G8 Education (appointed January 2016,
effective from February 2016)
• Genworth Mortgage Insurance Australia
Limited (appointed May 2016)
• Bendigo and Adelaide Bank Limited (appointed September 2019)
Directorships of Listed Entities Over Last 3 Years • Kina Securities Limited (appointed April 2015, ceased April 2018)
• Thorn Group Limited (appointed December 2014,
ceased October 2019)
DAVID AHMET Managing Director and Chief Executive Officer
• Appointed 30 June 2011 David is the Founder, Managing Director and Chief Executive Officer
of MotorCycle Holdings. David has successfully led the expansion
of MotorCycle Holdings since 1989 from 1 location to over 40
locations. David has over 30 years’ experience in motorcycle
dealerships and is responsible for leading the management team
and direction of the business, as well as maintaining relationships
with the Company’s suppliers and manufacturers.
David also sits on the Board of MotorCycle Finance Pty Ltd, as a
representative of the Company.
Current Directorships of other Listed Entities • Nil
Directorships of Listed Entities over last 3 years • Nil
Directors’ Report
WARREN BEE Independent Non-Executive Director
• Appointed 30 June 2011 Warren has been a director of MotorCycle Holdings since June
2011 and from 2007 to 2011 chaired the Company’s advisory board.
Warren also currently serves on the board of LEP Colour Printers.
Warren has also held chief executive officer and line management
roles across a range of industries. Warren is a Fellow of the Institute
of Chartered Accountants Australia and a member of the Australian
Institute of Company Directors.
Committee Membership • Chair of the Nomination and Remuneration Committee
• Member of the Audit and Risk Committee
Current Directorships of other Listed Entities • Nil
Directorships of Listed Entities over last 3 years • Nil
RICK DENNIS Independent Non-Executive Director
• Appointed 23 August 2016 with
effect from 1 September 2016
Rick joined the Board of the Company on 1 September 2016 after a
34-year career with Ernst and Young in Australia and the Asia-Pacific.
He was Queensland Managing Partner from 2001-07 and again for
2014. Rick established and led EY Australia’s China Business Group
in 2005 and was CFO and Deputy COO in the Asia-Pacific from
2010-13. Rick sat on the firm’s inaugural Asia-Pacific executive board
and a number of EY global boards and committees. Rick is currently
non-executive director of listed entity Apiam Animal Health Limited
and a member of the Queensland Advisory Board for Australian
Super and EWM Group.
Committee Membership • Chair of the Audit and Risk Committee
• Member of the Nomination and Remuneration Committee
Current Directorships of other Listed Entities • Apiam Animal Health Limited (appointed November 2016)
Directorships of Listed Entities over last 3 years • Omni Market Tide Limited (appointed
March 2016, ceased August 2017)
• Shine Corporate Limited (appointed August 2017,
ceased January 2019)
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PETER HENLEY Independent Non-Executive Director
• Appointed 1 March 2017 Peter has a long and distinguished career in financial services and in
particular consumer and commercial finance. Peter previously held
senior management positions at AGC Limited, CEO of Nissan Finance
Corp Ltd and CEO of GE Money in Australia and in South East Asia.
Since retiring from executive roles in October 2006, Peter has
been an Independent Non-Executive Director of Adtrans Group, MTA
Insurance Ltd, Thorn Group Ltd and more recently AP Eagers Ltd
where he has served on the Audit and Risk committee since 2006.
Peter is a Fellow of the Australian Institute of Management and a
member of the Australian Institute for Company Directors.
Committee Membership • Member of the Nomination and Remuneration Committee
• Member of the Audit and Risk Committee
• Chair of MotorCycle Finance Joint Venture Committee
(appointed 1 April 2018)
Current Directorships of other Listed Entities • Nil
Directorships of Listed Entities over last 3 years • Nil
ROB CASSEN Non-Independent Non-Executive Director
• Appointed 31 October 2017
(Executive Director)
• Appointed 21 December 2018
(Non-Executive Director)
Rob has 34 years’ experience in the motorcycle industry. He joined
the Board as part of the Company’s acquisition of the Cassons
Group, one of Australia’s largest motorcycle and bicycle clothing and
accessory distribution companies. Rob has developed strong supplier
relationships with major international and world leading brands and
manufacturers and has created one of the market leading private
label brands in Australia.
Committee Membership • Member Nomination and Remuneration Committee
(appointed 21 December 2018)
• Member Audit and Risk Committee (appointed 21 December 2018)
Current Directorships of other Listed Entities • Nil
Directorships of Listed Entities over last 3 years • Nil
Company Secretary
Nicole Spink (FCPA FGIA FCG(CS)) was appointed as Company Secretary on 28 May 2018. Nicole also holds the role of Group Financial
Controller and has held CFO and other senior finance roles in both the retail and automotive industries. Nicole is a Fellow of CPA Australia,
a Fellow of the Governance Institute of Australia, and a Fellow of the Chartered Governance Institute.
Directors’ meetings
The number of Directors’ meetings (including meetings of committees of Directors) and number of meetings attended by each of the
Directors of the Company during the financial year are:

Director Board Meetings
Audit & Risk Committee
(ARC) Meetings
Nomination and Remuneration
Committee (NRC) Meetings
Attended Held Attended Held Attended Held
David Foster 16 16 - - - -
David Ahmet 16 16 - - - -
Warren Bee 16 16 3 3 3 3
Rick Dennis 16 16 3 3 3 3
Peter Henley 16 16 3 3 3 3
Rob Cassen 16 16 3 3 3 3

Principal activities
The Company’s registered office and principal place of business is 68 Moss Street, Slacks Creek, Queensland, 4127.
The principal activities of the Group during the year were the ownership and operation of motorcycle dealerships engaging in the sale of new
motorcycles, used motorcycles, accessories and parts, finance, insurance as well as service and repair and the ownership and operation
of motorcycle accessories businesses engaging in the wholesaling and retailing of motorcycle accessories.
Operating and financial review
MotorCycle Holdings Limited (ASX:MTO) performed strongly during the year in challenging conditions, driven by a solid increase in
demand for new and used motorcycles, a lower cost structure, expanded product offering and improved dealer network. Performance
in the last quarter exceeded expectations following a resurgence in demand for recreation and leisure products upon the easing of
COVID-19 restrictions.
Key features of the company’s financial result include sales revenue increasing 10.3% to $363,712,000 (2019: $329,887,000) with
underlying EBITDA increasing 53.6% to $27,617,000 (2019: $17,985,000).
The company ended the year with a strong cash position of $39,494,000, up from $9,175,000 in 2019.
Net profit after tax and before impairment increased 81.9% to $15,176,000, up from $8,345,000 for the previous year.
A $24,296,000 non-cash impairment of goodwill which arose on the acquisition of Cassons has been recognised. This impairment charge
had no impact on the company’s debt facilities or compliance with banking covenants.
The company continued to outperform the market with total motorcycle sales increasing 13.8% to 21,095 units for the year ended 30
June 2020 (2019: 18,536 units).
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New motorcycle sales increased 16.3% to 11,013 units (2019:
9,468 units), compared with the national market increase in
new motorcycle sales of approximately 11.1%. Like for like new
motorcycle sales increased 7.5%.
The company grew its market share by securing approximately
11.1% of national new bike sales during the financial year,
compared with 10.6% in the prior year with sales improving
across all brands.
Used motorcycles sales increased 11.2% to 10,082 units (2019:
9,068 units).
Retail accessories and parts revenue increased 4.1% and servicing
and repair revenue increased 5.9%. Finance, insurance and
mechanical protection plan income increased 5.8%.
Cassons maintained profitability in a challenging market. Whilst
there was pressure on gross profit margins, Cassons’ performance
improved in the second half with external sales up 7.4% for the
year. Good progress was made in reducing excess inventory,
however an additional one-off non-cash stock obsolescence
charge of $591,000 has been recognised due to uncertainty
caused by the COVID-19 pandemic.
Directors are cautiously optimistic about the forthcoming year
however the recent increased sales momentum is expected to
temper, particularly if there are further restrictions introduced as a
result of the COVID-19 pandemic.
Dividends
Declared and Paid during the Financial Year
There were no dividends declared or paid during the Financial Year.
Declared after the end of the Financial Year
Directors have declared a special dividend of 5 cents per share
amounting to $3,085,000 payable on 30 September 2020 with a
record date of 9 September 2020.
There is no dividend re-investment plan in operation.
Events Subsequent to Reporting Date
There continues to be significant uncertainty relating to the
future impacts of the pandemic, with a number of states still
experiencing high case numbers. There has been no significant
impact of the pandemic on the Group’s operations subsequent to
30 June 2020 but management continue to closely monitor the
potential impacts on the Group.
Likely developments
The Group will continue to pursue its policy of increasing
profitability and market share in the markets within which it
operates during the next financial year.
Environmental regulation
The Group is subject to various environmental regulations under
both Commonwealth and State legislation.
The Directors believe that the Group has adequate systems in
place for the management of its environmental requirements
and is not aware of any significant breach of those environmental
requirements as they apply to the Group during the period covered
by this report.
Indemnification and Insurance of Officers
and Auditors
The Company has indemnified the Directors and Officers for costs
incurred in their capacity as a Director or Officer, for which they
may be held personally liable, except where there is a lack of
good faith. During the financial year, the Company paid insurance
premiums in respect of a contract to insure the Directors and
Officers of the Company against a liability to the extent permitted
by the Corporations Act 2001. The insurance contract prohibits
disclosure of the nature of liability and the amount of the premium.
During or since the end of the financial year the Company has not
indemnified or made a relevant agreement to indemnify an auditor
of the Company or of any related body corporate against a liability
incurred as such an officer of auditor. In addition, the Company
has not paid, or agreed to pay, a premium in respect of a contract
insuring against a liability incurred by an auditor.
Proceedings on behalf of the Company
No person has applied to the Court under section 237 of the
Corporations Act 2001 for leave to bring proceedings on behalf
of the Company, or to intervene in any proceedings to which the
Company is a party for the purpose of taking responsibility on
behalf of the Company for all or part of those proceedings.
Underlying EBITDA
Underlying EBITDA is a non-GAAP financial measure, and is calculated as earnings before non-bailment interest, taxation, depreciation,
amortisation and acquisition expenses. A reconciliation between net profit after tax and Underlying EBITDA is presented as follows:
30 Jun 2020
$’000
30 Jun 2019
$’000
Net profit after tax (9,120) 8,345
Add:
Bank interest expense 1,529 2,121
Income tax expense 6,702 3,702
Depreciation¹ and amortisation 3,787 3,790
Impairment 24,296 -
Acquisition costs 423 27
Underlying EBITDA 27,617 17,985
¹ Excludes depreciation on ROU assets
Non-audit services
During the year KPMG, the Group’s auditor, has performed certain other services in addition to the audit and review of the financial
statements. The total remuneration of the auditor is disclosed in Note 30 of the Financial Report.
For those activities, the board has considered the non-audit services provided during the year by the auditor and in accordance with written
advice provided by the Audit and Risk Committee, is satisfied that the provision of those non-audit services by the auditor is compatible
with, and did not compromise, the auditor independence requirements of the Corporations Act 2001 for the following reasons:
• all non-audit services have been reviewed by the Audit and Risk Committee to ensure they do not impact the integrity
and objectivity of the auditor, and
• the non-audit services provided do not undermine the general principles relating to auditor independence as set out in APES
110 Code of Ethics for Professional Accountants, as they did not involve reviewing or auditing the auditor’s own work, acting in a
management or decision-making capacity for the Group, acting as an advocate for the Group or jointly sharing risk and reward.
Details of the amounts paid to KPMG for non-audit services provided during the year are set out below:
2020
$
Services other than audit and review of financial statements:
Tax compliance services 72,000
Indirect tax compliance services 11,000
Total non-audit services 83,000
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Lead Auditor’s Independence Declaration
A copy of the Auditor’s Independence Declaration as required under section 307C of the Corporations Act 2001 is attached on page 26 and
forms part of this report.
Rounding Off
The Company is of a kind referred to in ASIC Corporation Instrument 2016/191, relating to the ‘rounding off’ of amounts in the Directors’
Report and the consolidated financial statements which have been rounded off to the nearest thousand dollars, unless otherwise stated,
in accordance with that Instrument.
Deeds of Cross Guarantee
At the date of this report and during the Financial Year, the Company is within the class of companies affected by ASIC Corporations (Wholly
owned Companies) Instrument 2016/785. The nature of the deed of cross guarantee is such that each company which is party to the deed
guarantees to each creditor payment in full of any debt in accordance with the deed of cross guarantee.
Directors’ Interests
The relevant interest of each Director in the shares and rights or options over such shares issued by the Company, and other related bodies
corporate, as notified by the Directors to the ASX in accordance with section 205G(1) of the Corporations Act 2001 at the date of this report
is as follows:
Name Ordinary Shares Rights Over Ordinary Shares
David Foster 44,949 -
Warren Bee 38,958 -
Rick Dennis - -
Peter Henley 25,534 -
Rob Cassen 3,363,833 -
David Ahmet 11,288,994 446,323

Remuneration Report - Audited
The information provided in this Remuneration Report has been prepared in accordance with section 300A of the Corporations Act
2001 (Cth).
Key Management Personnel
The Remuneration Report outlines remuneration for those people considered to be Key Management Personnel (KMP) of the Group during
the Reporting Period. KMP are persons having authority and responsibility for planning, directing and controlling the activities of MotorCycle
Holdings Limited.
KMP consist of:
• non-executive directors; and
• executive directors and senior executives.
The table below summarises details of KMP of the Group for the financial year ended 30 June 2020, their roles and appointment/
cessation dates.
Key Management Personnel during the Reporting Period
Name Role Appointment Date
Non-Executive Directors
David Foster Chair, Independent, Non-Executive Director 8 March 2016
Warren Bee Independent, Non-Executive Director 30 June 2011
Rick Dennis Independent, Non-Executive Director 23 August 2016
Peter Henley Independent, Non-Executive Director 1 March 2017
Rob Cassen Non-Independent, Non-Executive Director 21 December 2018
Executive Directors and Senior Executives
David Ahmet Managing Director 30 June 2011
Bob Donovan Chief Financial Officer 20 May 2019

Remuneration Governance
The following diagrammatic representation shows the framework the Board has in place to establish and review remuneration for KMP
and employees of the Group:
Management provides information
relevant to remuneration decisions
and makes recommendations to
the NRC.




Management
Nomination &
Remuneration
Committee
Board
NRC is delegated to review and
make recommendations to the
Board on remuneration policies
for non-executive directors, senior
executives and all employees
including incentive arrangements
and awards. The NRC can appoint
remuneration consultants and
other external advisors to
provide independent advice.

Approves the overall remuneration
framework and policy, ensuring it is
fair, transparent and aligned with
long term outcomes. Approves
incentive arrangements and awards
for Executive Directors and Senior
Executives.

Approves remuneration of non-
executive directors within the
shareholder approved fee cap.
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Non-Executive Director Remuneration
Policy
A copy of the remuneration policy for non-executive Directors is available on the Company’s website. The Board’s Non-Executive Director
remuneration policy is to:
• Provide a clear fee arrangement that avoids potential conflicts of interest associated with performance incentives;
• Remunerate Directors at market rates for their commitment and responsibilities; and
• Obtain independent external remuneration advice when required.
Non-Executive directors receive remuneration for undertaking their role. They do not participate in the Company’s incentive plans or receive
any variable remuneration. Non-Executive Directors are not entitled to retirement payments.
The aggregate Non-Executive Director remuneration cap approved by shareholders prior to listing is $600,000 per annum (inclusive of
superannuation contributions). The Board determines the distribution of Non-Executive Director fees within the approved remuneration cap.
Remuneration of Non-Executive Directors
The following table sets out the Annual Board and Committee fees (inclusive of superannuation) as at the date of this Report:

Non-Executive
Directors
Board
Member
Board
Chair
Audit & Risk
Committee
Nomination &
Remuneration
Committee
MotorCycle
Finance JV
Committee
Total Fees
$
David Foster 80,000 95,000 - - - 175,000
Warren Bee 70,000 - 5,000 10,000 - 85,000
Rick Dennis 70,000 - 10,000 5,000 - 85,000
Peter Henley 70,000 - 5,000 5,000 10,000 90,000
Rob Cassen 70,000 - 5,000 5,000 - 80,000
Total 360,000 95,000 25,000 25,000 10,000 515,000
Executive Director and Senior Executive Remuneration
Policy
The Board’s policy for determining the nature and amount of remuneration for the Executive Director and Senior Executives is:
• Provide for both fixed and performance-based remuneration;
• Provide a remuneration package based on an annual review of employment market
conditions, the Group’s performance and individual performance; and
• Obtain independent external remuneration advice when required.
Remuneration and other terms of employment for Senior Executives are formalised in agreements which have a provision for bonuses and
other benefits which may be granted from time to time by the Board of Directors. Contracts with Executives may be terminated by either
party with either three- or six-months’ notice.
Fixed Remuneration
Fixed remuneration is a function of size and complexity of the role, individual responsibilities, experiences, skills and market pay levels. This
consists of cash salary, salary sacrifice items and employer superannuation at the statutory contribution rate.
The Board determines an appropriate level of fixed remuneration for the Senior Executives with recommendations from the Nomination and
Remuneration Committee. Fixed remuneration is reviewed annually following performance reviews at the end of the financial year and takes
into account role and accountabilities, relevant market benchmarks and attraction, retention and motivation of executives in the context of
the talent market.
Performance Linked Remuneration
Short Term Annual Cash Bonus
The Managing Director and Chief Financial Officer were eligible to participate in the Group’s short-term incentive plan during the
Reporting Period.
Under the plan, participants have an opportunity to receive an annual cash bonus calculated as a percentage of their salary (base pay
not including superannuation) and conditional on the achievement of short-term financial and non-financial performance measures at a
corporate and individual level. The short-term financial measures represent 70% of the maximum bonus payable. The measure is based on
the profitability of the Group compared to the annual budget as approved by the Board. If actual profitability for the year is less than 85%
of the approved budget, no short-term incentive is paid. The bonus is adjusted pro-rata where profitability is between 85% to 100% of the
approved budget. The non-financial measures represent the remaining 30% of the cash bonus payable. The Board considers the executives’
contribution towards the achievement of strategic initiatives of the Group, which include acquisitions and their integration into the business,
when determining whether such bonuses will be awarded.
Payments made under the short-term incentive plan are assessed by the Nomination and Remuneration Committee and approved by the
Board. The Board retains an overall discretion on whether to pay all, a portion of, or no annual cash bonus.
Under the short-term incentive plan, participants have an opportunity to receive Cash Bonuses included in Remuneration. The short-term
financial and non-financial performance measures established by the Board at the commencement of the financial year were not achieved
and the Board did not award a short-term incentive payment to participants in the short-term incentive plan.

Key Management Personnel Performance-Linked Remuneration Payments
Employed at
30 June 2020 Position
Max Potential
Bonus % of Salary
Actual Amount of
Bonuses Included in FY20
Remuneration $ % Max Bonus
David Ahmet Managing Director 50% $nil 0
Bob Donovan Chief Financial Officer 50% $nil 0
Long Term Incentive Plan (“LTIP”)
The LTIP was approved by shareholders at the Company’s annual general meeting in 2017. The purpose of the LTIP is to:
• Align employee incentives with Shareholders’ interests;
• Encourage broad based share ownership by employees; and
• Assist employee attraction and retention.
Through the LTIP, senior executives are incentivised to improve the Company’s financial performance and generate shareholder returns
through the granting of performance rights. Performance rights constitute a right to receive ordinary shares in the capital of the Company
upon the achievement of certain performance hurdles.
21
MotorCyle Holdings Limited - Annual Report 2020
Directors’ Report continued...
MotorCyle Holdings Limited - Annual Report 2020
20
Performance criteria
The performance rights are subject to certain performance hurdles being met over the relevant monitoring period. These performance
hurdles include:
(1) Relative total shareholder return (“TSR”):
50% of the Performance Rights are subject to relative TSR assessed over a 3-year performance period commencing 1 July 2019 and ending
30 June 2022, compared to a peer group of 12 ASX listed companies. Vesting will occur based on the Company’s positioning in the peer
group. This is designed to focus executives on delivering sustainable long-term shareholder returns.
Peer Companies
AP Eagers Limited Autosports Group Limited
Bapcor Limited Apollo Tourism & Leisure Ltd.
Super Retail Group Limited Fleetwood Corporation Limited
Thorn Group Limited PWR Holdings Limited
ARB Corporation Limited Schaffer Corporation Limited
AMA Group Limited Sprintex Limited
TSR ranking Proportion to vest
Less than 50th percentile 0%
50th to 75th percentile Between 50% and 100% (as determined on a straight-line basis)
At or above 75th percentile 100%

(2) Earnings per share (“EPS”):
50% of the Performance Rights are subject to growth in the Company’s EPS assessed over a 3-year performance period commencing 1 July
2019 and ending 30 June 2022, on a compound annual growth rate (“CAGR”) basis. Vesting will occur based on the following performance:
The Company’s EPS CAGR over the Performance Period
Proportion of the Tranche 2 Awards that satisfy the EPS
Vesting Condition
EPS CAGR is less than or equal to 10% 0%
EPS CAGR is greater than 10% and less than or equal to 12% Between 50% and 100% (as determined on a straight-line basis)
EPS CAGR is equal to or greater than 12% 100%


The Managing Director and Chief Financial Officer were eligible to participate in the Group’s long-term incentive plan during the year,
comprising grants of performance rights over the Company’s ordinary shares. The LTIP scheme was approved by shareholders at the 2017
AGM and the notice of meeting lodged with ASX contains further details on the performance rights. Actual performance rights granted,
forfeited and outstanding in the reporting period are set out in the following table.
Description
of Rights
Opening
Balance
of Rights
Numbers
of Rights
Granted
in FY20
Fair Value per Right
at Grant Date
Grant
date
Performance
period
Number
of Rights
Forfeited
in FY20
Value of
Rights
Forfeited
% of
Remuneration
Granted as
Rights During
the Reporting
Period
Closing
Balance
of Rights
TSR
Component
EPS
Component
David Ahmet, Managing Director
FY18 LTIP 86,905 - $1.60 $3.01
24
April
2018
1 July 2017
to 30 June
2020
- - 9% 86,905
FY19 LTIP 96,618 - $0.20 $1.24
27
June
2019
1 July 2018
to 30 June
2021
- - 6% 96,618
FY20 LTIP - 262,800 $1.41 $1.65
26
June
2020
1 July 2019
to 30 June
2022
- - 21% 262,800
Bob Donovan, Chief Financial Officer
FY18 LTIP 13,758 - $1.60 $3.01
24
April
2018
1 July 2017
to 30 June
2020
- - 4% 13,758
FY19 LTIP 15,294 - $0.20 $1.24
27
June
2019
1 July 2018
to 30 June
2021
- - 2% 15,294
FY20 LTIP - 41,600 $1.41 $1.65
26
June
2020
1 July 2019
to 30 June
2022
- - 9% 41,600

Company performance and remuneration outcomes
The various components of the way the Group remunerates key management personnel have been structured to support the Group’s
strategy and business objectives which in turn are designed to generate shareholder wealth.
When setting targets and determining the quantum of the remuneration increases and the proportion of fixed and performance linked
remuneration components, the Board refers to remuneration benchmarking reports provided by independent sources and remuneration
consultants from time to time.
The at-risk component of the remuneration structure intends to reward achievement against Company and individual performance measures
over a one-year timeframe. An overview of the measures is set out above.
The Board retains an overarching discretion to award an annual bonus. In exercising that discretion, they have regard to the remuneration
policy, market conditions, Group financial performance and affordability.
The table below summarises the Group’s financial performance for FY2020 compared to prior periods and correlates it to the total KMP
remuneration for the respective financial years.
Metric 2020 2019 2018 2017 2016
Statutory Net Profit/(Loss) After Tax ($’000) (9,120) 8,345 8,539 9,280 5.571
Change in Share Price 60.5% (65.5%) (10.3%) 46.5% 7.6%
Earnings per Share (14.8) cents 13.5 cents 15.6 cents 24.5 cents 18.7 cents
Total Dividends Paid ($) - 4,010,940 6,240,124 2,846,250 -
KMP Remuneration ($) 1,589,465 2,371,480 1,984,461 2,098,125 1,512,949

23
MotorCyle Holdings Limited - Annual Report 2020
Directors’ Report continued...
MotorCyle Holdings Limited - Annual Report 2020
22
Key Management Personnel Remuneration
Details of the nature and amount of each major element of remuneration of each Director and Senior Executive of the Group for the
Reporting Period are:
Name & Role Year
Short Term Employee Benefits
Cash Salary
& Fees $
Cash
Bonus $
Non-
Cash
Benefit $ Total $
Current Non-Executive Directors
David Foster, Chair,
Non-Executive Director
2020 157,973 - - 157,973
2019 159,817 - - 159,817
Warren Bee,
Non-Executive Director
2020 76,730 - - 76,730
2019 77,625 - - 77,625
Rick Dennis,
Non-Executive Director
2020 76,730 - - 76,730
2019 77,625 - - 77,625
Peter Henley,
Non-Executive Director
2020 63,953 - - 63,953
2019 69,240 - - 69,240
Rob Cassen1,
Non-Executive Director
2020 72,217 - - 72,217
2019 36,530 - - 36,530
Total Non-Executive
Director Remuneration
2020 447,602 - - 447,602
2019 420,837 - - 420,837
Former Executive Directors and Senior Executives
Rob Cassen1,
Non-Executive Director
2020 - - - -
2019 109,028 - - 109,028
Chris Chenoweth2,
General Manager
2020 - - - -
2019 92,391 40,718 - 133,109
Eddie Macdonald3,
Chief Financial Officer
2020 - - - -
2019 325,181 - - 325,181
Adrian Murphy4,
Chief Operating Officer
2020 - - - -
2019 196847 - - 196847
Total Non-Executive
Directors Remuneration
2020 - - - -
2019 723,447 40,718 - 764,165
Current Executive Directors and Senior Executives
David Ahmet,
Managing Director
2020 598,747 - - 598,747
2019 636,951 - - 636,951
Bob Donovan5,
Chief Financial Officer
2020 230,594 - - 230,594
2019 237,443 - - 237,443
Total Current Executive Director
and Senior Executive Remuneration
2020 829,341 - - 829,341
2019 874,394 - - 874,394
Total KMP Remuneration
2020 1,276,943 - - 1,276,943
2019 2,018,678 40,718 - 2,059,396
1 Appointed as Executive Director 31 October 2017. Appointed as Non-Executive Director 21 December 2018.
2 Appointed 15 September 2008. Resigned 31 December 2018.
3 Appointed 28 May 2018. Resigned 20 May 2019.
Post-Employment
Benefits Long Term Benefits
Proportion of
remuneration
performance
related %
Superannuation
Benefits $
Termination
Benefits $
Long
Service
Leave $
Share
Based
Benefits $ Total $
15,008 - - - 172,980 -
15,183 - - - 175,000 -
7,289 - - - 84,019 -
7,375 - - - 85,000 -
7,289 - - - 84,019 -
7,375 - - - 85,000 -
25,008 - - - 88,961 -
21,710 - - - 90,950 -
6,861 - - - 79,078 -
3,470 - - - 40,000 -
61,455 - - - 509,057 -
55,113 - - - 475,950 -
- - - - - -
14,112 - - - 123,140 -
- - - - - -
11,870 - - - 144,979 22%
- - - - - -
23,077 89563 - - 437,821 -
- - - - - -
13462 - - - 210309 -
- - - - - -
62,521 89563 - - 916,249 -
20,349 - 9,979 168,342 797,417 21%
20,048 - 10,616 41,188 708,803 6%
21,906 - 3,843 26,648 282,992 9%
22,557 - 3,957 6,521 270,478 2%
42,255 - 13,822 194,990 1,080,408 -
42,605 - 14,573 47,709 979,281 -
103,710 - 13,822 194,990 1,589,465 -
160,239 89,563 14,573 47,709 2,371,480 -
4 Appointed 6 August 2018. Resigned 14 February 2019.
5 Appointed General Manager – Business Development and Integration 28 May 2018. Appointed Chief Financial Officer 20 May 2019.
25
MotorCyle Holdings Limited - Annual Report 2020
Directors’ Report continued...
MotorCyle Holdings Limited - Annual Report 2020
24
Other Information
Contract Duration and Termination Requirements
The Company has contracts of employment with no fixed tenure requirements with the Managing Director and Senior Executives. The notice
period for each is outlined in the table below. Termination with notice may be initiated by either party. The contracts contain customary
clauses dealing with immediate termination for gross misconduct, confidentiality and post-employment restraint of trade provisions.
Name Position Notice Period
Non-Executive Directors
David Ahmet Managing Director 6 months
Senior Executives
Bob Donovan Chief Financial Officer 3 months

Other Transactions with Key Management Personnel
Subsidiaries of the Group have entered into property leases for business premises with David Ahmet and Rob Cassen, including associated
entities. The leases have been entered into on an arm’s length basis and have terms and conditions consistent with leases in the respective
areas. A summary of the leases is set out in Note 31 to the financial statements.
Shareholdings of Key Management Personnel
The movement in the number of ordinary shares held in the Company, either directly or indirectly or beneficially, by each member of the Key
Management Personnel, including their related parties, is as follows:
Name
Shareholdings of KMP
Opening
Balance
1 July 2019
Shares
acquired
during the year
Shares disposed
of during
the year
Received on
vesting of rights
to deferred shares
Other
changes
Closing
Balance 30
June 2020
Non-Executive Directors
David Foster 44,949 - - - - 44,949
Warren Bee 38,958 - - - - 38,958
Rick Dennis - - - - - -
Peter Henley 14,034 11,500 - - - 25,534
Rob Cassen 3,181,819 182,014 - - - 3,363,833
Executive Directors and Senior Executives
David Ahmet 11,183,907 105,087 - - - 11,288,994
Bob Donovan 598,052 - - - - 598,052
Remuneration Consultants
To ensure the Nomination and Remuneration Committee is fully informed on remuneration matters it engages with external remuneration
advisors. The terms of engagements outline the advisors’ access to, and independence from, the Group and management. Any advice sought
is used as a guide and does not serve as a substitute for the committee’s consideration of remuneration matters. The following external
advisors provided information and assistance during 2020:
• PricewaterhouseCoopers – Development of Long-Term Incentive Plan Rules and Valuation of Performance Rights under Long Term
Incentive Plan.
These advisors did not provide any remuneration recommendations and they were not “remuneration consultants” to the Group as defined
in the Corporation Act 2001.
Signed in accordance with a resolution of the directors:
David Foster
Chair
27 August 2020
David Ahmet
Managing Director
27 August 2020
27
MotorCyle Holdings Limited - Annual Report 2020MotorCyle Holdings Limited - Annual Report 2020
26
FINANCIAL
STATEMENTS
28
Consolidated Statement of Profit or
Loss and Other Comprehensive Income

29
Consolidated Statement of Financial Position

30
Consolidated Statement of Changes in Equity

31
Consolidated Statement of Cash Flows

32
Notes to and Forming Part of the
Consolidated Financial Statements

67
Directors’ Declaration

68
Independent Auditor’s Report

74
Additional Information

77
Corporate Directory





Liability limited by a scheme approved
under Professional Standards
Legislation.
KPMG, an Australian partnership and a member
firm of the KPMG network of independent member
firms affiliated with KPMG International Cooperative

Lead Auditor’s Independence Declaration under
Section 307C of the Corporations Act 2001

To the Directors of MotorCycle Holdings Limited

I declare that, to the best of my knowledge and belief, in relation to the audit of MotorCycle Holdings
Limited for the financial year ended 30 June 2020 there have been:
i. no contraventions of the auditor independence requirements as set out in the
Corporations Act 2001 in relation to the audit; and
ii. no contraventions of any applicable code of professional conduct in relation to the audit.



KPMG Simon Crane
Partner

Brisbane
27 August 2020







Liability limited by a scheme approved
under Professional Standards
Legislation.
KPMG, an Australian partnership and a member
firm of the KPMG network of independent member
firms affiliated with KPMG International Cooperative


To the shareholders of MotorCycle Holdings Limited
Report on the audit of the Financial Report

Opinion
We have audited the Financial Report of
MotorCycle Holdings Limited (the
Company).
In our opinion, the accompanying
Financial Report of the Company is in
accordance with the Corporations Act
2001, including:
• giving a true and fair view of the
Group's financial position as at 30
June 2020 and of its financial
performance for the year ended on
that date; and
• complying with Australian Accounting
Standards and the Corporations
Regulations 2001.

The Financial Report comprises:
• Consolidated statement of financial position as at 30
June 2020;
• Consolidated Statement of Profit or Loss and Other
Comprehensive Income, Consolidated Statement of
Changes in Equity and Consolidated Statement of Cash
Fl ws for the year then ended;
• Notes including a summary of significant accounting
policies; and
• Directors' Declaration.
The Group consists of the Company and the entities it
controlled at the year-end or from time to time during the
financial year.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
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 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 fulfilled our other ethical responsibilities in accordance with the
Code.



Independent Auditor’s Report

29
MotorCyle Holdings Limited - Annual Report 2020MotorCyle Holdings Limited - Annual Report 2020
28
Note
30 Jun 2020
$’000
30 Jun 2019
$’000
Sales revenue 6 348,588 315,054
Other income1 6 21,101 14,833
Cost of sales 261,616 233,485
Employee benefits expense 7 52,828 51,661
Finance costs2 8 3,880 2,890
Depreciation and amortisation expense 13,188 3,790
Impairment expense 15 24,296 -
Occupancy costs 2,509 12,339
Other expenses 7 13,790 13,675
Profit/(loss) before tax (2,418) 12,047
Income tax expense 9 6,702 3,702
Profit/(loss) for the period (9,120) 8,345
Other comprehensive income (181) (290)
Total comprehensive income for the year attributable to owners
of the company
(9,301) 8,055
Cents Cents
Earnings per share 10
Basic earnings per share (14.8) 13.5
Diluted earnings per share (14.8) 13.5
¹ Other income includes JobKeeper payments, see Note 6.
² The Group has presented interest expense on lease liabilities separately from the depreciation charge for right-of-use assets. Interest expense on lease liabilities is a
component of finance costs, which is presented in the statement of profit or loss and other comprehensive income. See Notes 8 and 29
The Group has initially applied AASB 16 as at 1 July 2019 using the modified retrospective approach. Under this approach comparative information is not restated and
the cumulative effect of initially applying AASB 16 is recognised in retained earnings at the date of initial application. See Note 3.
The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the accompanying notes.
F inanc ia l S tatements ( cont inued)
Conso l idated Statement o f P ro f i t o r Loss
and Other Comprehens ive Income
For the Year Ended 30 June 2020
Conso l idated Statement o f F inanc ia l Pos i t ion
As at 30 June 2020
Note
30 Jun 2020
$’000
30 Jun 2019
$’000
Current assets
Cash and cash equivalents 11 39,494 9,175
Trade and other receivables 12 7,592 8,179
Inventories 13 74,425 84,396
Current tax assets - 2,095
Other assets - 12
Total current assets 121,511 103,857
Non-current assets
Right of use assets 29 28,795 -
Property, plant and equipment 14 11,464 11,546
Deferred tax assets 9 488 653
Goodwill and other intangible assets 15 94,571 119,684
Interest in equity accounted investees 16 3,164 3,539
Other assets 146 117
Total non-current assets 138,628 135,539
Total assets 260,139 239,396
Current liabilities
Trade and other payables 17 12,652 12,457
Short term borrowings 18 30,602 30,550
Lease liabilities 11,100 -
Current tax liabilities 9 2,057 -
Provisions 19 6,459 5,692
Contract liabilities 2,444 2,988
Total current liabilities 65,314 51,687
Non-current liabilities
Borrowings 20 44,623 46,815
Lease liabilities 20,227 -
Provisions 19 582 1,448
Contract liabilities 4,804 4,209
Total non-current liabilities 70,236 52,472
Total liabilities 135,550 104,159
Net assets 124,589 135,237
Equity
Contributed equity 21 120,081 120,081
Share-based payment reserve 254 177
Retained earnings 4,254 14,979
Total equity 124,589 135,237
The Group has initially applied AASB 16 as at 1 July 2019 using the modified retrospective approach. Under this approach comparative information
is not restated and the cumulative effect of initially applying AASB 16 is recognised in retained earnings at the date of initial application. See Note 29.

The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
31
MotorCyle Holdings Limited - Annual Report 2020MotorCyle Holdings Limited - Annual Report 2020
30
F i nanc ia l S tatements ( cont inued)
Conso l idated Statement o f Changes in Equ i ty
For the Year Ended 30 June 2020
Issued
Capital
$’000
Retained
Earnings
$’000
Share-Based
Payment
Reserve
$’000
Total
Equity
$’000
Balance at 1 July 2018 120,081 10,935 88 131,104
Comprehensive income for the period
Profit for the period - 8,345 - 8,345
Other comprehensive income - (290) - (290)
Total comprehensive income for the period - 8,055 - 8,055
Transactions with owners in their capacity as owners
Dividends paid - (4,011) - (4,011)
Equity settled share-based payment - - 89 89
Total transactions with owners in their capacity as owners - (4,011) 89 (3,922)
Balance at 30 June 2019 120,081 14,979 177 135,237
Adjustment on initial application of AASB 16 (net of tax) - (1,424) - (1,424)
Restated Balance at 1 July 2019 120,081 13,555 177 133,813
Comprehensive income for the period
Loss for the period - (9,120) - (9,120)
Other comprehensive income - (181) - (181)
Total comprehensive income for the period - (9,301) - (9,301)
Transactions with owners in their capacity as owners
Dividends paid - - - -
Equity settled share-based payment - - 77 77
Total transactions with owners in their capacity as owners - - 77 77
Balance at 30 June 2020 120,081 4,254 254 124,589
The Group has initially applied AASB 16 as at 1 July 2019 using the modified retrospective approach. Under this approach comparative information is not restated and the
cumulative effect of initially applying AASB 16 is recognised in retained earnings at the date of initial application. See Note 29.
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
Conso l idated Statement o f Cash F lows
For the Year Ended 30 June 2020
Note
30 Jun 2020
$’000
30 Jun 2019
$’000
Cash flows from operating activities
Receipts from customers (inclusive of GST) 406,606 362,228
Payments to suppliers and employees (inclusive of GST) (365,812) (335,460)
Interest and other costs of finance paid (3,607) (2,890)
Income taxes paid (1,693) (4,888)
Interest received 9 11
Net cash (used)/provided by operating activities 32 35,503 19,001
Cash flows from investing activities
Payment for acquisition of businesses (net of cash acquired) (2,581) -
Payments for investments in equity accounted investees - (2,750)
Payments for property, plant and equipment (1,213) (2,185)
Proceeds from sale of property, plant and equipment 66 126
Net cash (used)/provided by investing activities (3,728) (4,809)
Cash flows from financing activities
Proceeds from/(repayment of) borrowings (1,167) (3,475)
Principal portion of lease liability repayments (289) -
Dividend paid 21 - (4,011)
Net cash (used)/provided by financing activities (1,456) (7,486)
Net increase/(decrease) in cash and cash equivalents 30,319 6,706
Cash and cash equivalents at the beginning of the period 9,175 2,469
Cash and cash equivalents at the end of the period 11 39,494 9,175
The Group has initially applied AASB 16 as at 1 July 2019 using the modified retrospective approach. Under this approach comparative information is not restated and the
cumulative effect of initially applying AASB 16 is recognised in retained earnings at the date of initial application. See Note 29.
The above Consolidated Interim Statement of Cash Flows should be read in conjunction with the accompanying notes.
33
MotorCyle Holdings Limited - Annual Report 2020MotorCyle Holdings Limited - Annual Report 2020
32
1. Reporting Entity
MotorCycle Holdings Limited (the “Company”) is a publicly listed
company domiciled in Australia. Its registered office is at 68 Moss
Street, Slacks Creek, Queensland, 4127. The consolidated financial
statements as at and for the year ended 30 June 2020 comprise
the Company and its subsidiaries (together referred to as the
“Group”) and were authorised for issue by the Board of Directors
on 27 August 2020.
The principal activities of the Group during the year were the
ownership and operation of motorcycle dealerships engaging in the
sale of new motorcycles, used motorcycles, accessories and parts,
finance, insurance as well as service and repair and the ownership
and operation of motorcycle accessories businesses engaging in
the wholesaling and retailing of motorcycle accessories.
2. Significant Accounting Policies
A. General Information
Statement of Compliance
These consolidated financial statements are general purpose
financial statements which have been prepared in accordance with
Australian Accounting Standards (AASBs) adopted by the Australian
Accounting Standards Board (AASB) and the Corporations Act 2001.
The consolidated financial statements comply with International
Financial Reporting Standards and interpretations issued by the
International Accounting Standards Board.
Basis of Preparation
For the purposes of preparing the consolidated financial
statements, the Company is a for-profit entity. The consolidated
financial statements have been prepared on the basis of
historical cost unless the application of fair value measurement
is required by relevant accounting standards. All amounts are
presented in Australian dollars and is the Company’s functional
and presentation currency.
The Company is of a kind referred to in ASIC Corporations
(Rounding in Financial/Director’s Reports) Instrument 2016/191
dated 24 March 2016, and as such all financial information
presented has been rounded to the nearest thousand dollars
unless otherwise stated.
This is the first set of the Group’s annual financial statements in
which AASB 16 Leases has been applied. Changes to significant
accounting policies are described in Note 3.
F inanc ia l S tatements ( cont inued)
Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
Accounting Policies
The following is a summary of the material accounting policies
adopted in the preparation of the financial report. The accounting
policies have been consistently applied, unless otherwise stated.
B. Basis of Consolidation
The consolidated financial statements incorporate the financial
statements of the Company and entities controlled by the
Company. Control is achieved 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 over the entity.
Consolidation of a subsidiary begins when the Company obtains
control over the subsidiary and ceases when the Company loses
control of the subsidiary. Specifically, income and expenses
of a subsidiary acquired or disposed of during the year are
included in the consolidated statement of profit or loss and other
comprehensive income from the date the company gains control
until the date when the Company ceases to control the subsidiary.
All intragroup assets and liabilities, equity, income, expenses and
cash flows relating to transactions between members of the
Group are eliminated in full on consolidation.
Interest in Equity-Accounted Investees
The Group’s interest in equity-accounted investees comprises
interests in a joint venture. A joint venture is an arrangement in
which the Group has joint control, whereby the Group has rights to
the net assets of the arrangement, rather than rights to its assets
and obligations for its liabilities.
Interests in the joint venture are accounted for using the
equity method. They are initially recognised at cost, which
includes transaction costs. Subsequent to initial recognition
the consolidated financial statements include the Group’s share
of profit or loss and other comprehensive income of equity-
accounted investees, until the date which significant influence
or joint control ceases.
Business Combinations
The acquisition method of accounting is used for all business
combinations regardless of whether equity instruments or other
assets are acquired. Consideration transferred is measured as the
fair value of the assets given, shares issued or liabilities incurred
or assumed at the date of exchange. Acquisition related costs are
recognised in profit or loss as incurred. Where equity instruments
are issued in an acquisition, the value of the instruments is their
published market price as at the date of exchange. Transaction
costs arising on the issue of equity instruments are recognised
directly in equity.
Identifiable assets acquired and liabilities and contingent
liabilities assumed in a business combination are measured
initially at their fair values at the acquisition date. The excess of
the cost of acquisition over the fair value of the Group’s share of
the identifiable net assets acquired is recorded as goodwill (refer
to Note 15).
Where settlement of any part of cash consideration is deferred,
the amounts payable in the future are discounted to their present
values as at the date of acquisition. The discount rate used is
the incremental borrowing rate, being the rate at which a similar
borrowing could be obtained from an independent financier under
comparable terms and conditions.
If the initial accounting for a business acquisition is incomplete by
the end of the reporting period in which the combination occurs,
the consolidated entity reports provisional amounts for the items
for which accounting is incomplete. The provisional amounts are
adjusted during the measurement period (no longer than 12 months
from the initial acquisition) on a retrospective basis by restating the
comparative information presented in the financial statements.
C. Revenue
Sales Revenue
Revenue from the sales of new and used motorcycles,
accessories and parts is recognised when the performance
obligation has been satisfied, which is considered at the point in
time when the motorcycle, parts or accessories are invoiced and
physically shipped to or collected by the customer.
Under the Group’s standard contract terms, the customer has
a right to return the product within a specified period and the
Group is obliged to refund the purchase price. Under AASB 15, the
Group reduces revenue by the amount of expected returns and
records it as ‘trade and other payables’. The Group estimates the
amount of returns based on the historical data for motorcycles,
parts and accessories.
Service Revenue
Service work on customers’ motorcycles is carried out under
instructions from the customer. Service revenue is recognised
over time based on when the performance obligation is satisfied,
which is when the requested services work is rendered.
Revenue arising from the sale of parts fitted to customers’
motorcycles during a service is recognised at a point in time
upon satisfaction of the performance obligation, being the
completion of the service.
Mechanical Protection Plan Revenue
Revenue from the sale of mechanical protection plans (MPP) is
recognised over time based on when the performance obligation
is satisfied, which is on a straight-line basis over the period of
the MPP. The premium collected from the sale of MPP is initially
recognised as a contract liability. Costs related to satisfying
approved customer claims under the MPP contracts are recognised
in profit or loss and expensed as incurred.
Interest Revenue
Interest revenue is recognised on a time proportional basis,
taking into account the effective interest rates applicable to the
financial assets.
Finance and Insurance Commission Revenue
The Group acts as an agent in the sale of motorcycle finance
and insurance products. Commission revenue is recognised at a
point in time when the performance obligation is satisfied, which
is upon delivery of the associated motorcycle and the transfer of
control to the customer.
D. Finance Costs
Interest expense on bailment finance and other borrowings is
recognised using the effective interest method.
E. Taxes
Income Tax
The income tax expense or revenue for the period is the tax
payable on the current period’s taxable income based on the
notional income tax rate, adjusted by changes in deferred tax
assets and liabilities attributable to temporary differences between
the tax bases of assets and liabilities and their carrying amounts in
the financial statements, and to unused tax losses.
Deferred tax assets and liabilities are recognised for temporary
differences at the tax rates expected to apply when the assets
are recovered or liabilities are settled, based on those tax rates
which are enacted or substantively enacted for each jurisdiction.
The relevant tax rates are applied to the cumulative amounts of
deductible and taxable temporary differences to measure the
deferred tax asset or liability. An exception is made for certain
temporary differences arising from the initial recognition of an
asset or a liability. No deferred tax asset or liability is recognised
in relation to these temporary differences if they arose in a
transaction, other than a business combination, that at the time of
the transaction did not affect either accounting profit or taxable
profit or loss.
35
MotorCyle Holdings Limited - Annual Report 2020
F inanc ia l S tatements ( cont inued)
Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
34
2. Significant Accounting Policies (continued)
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.
Current and deferred tax balances attributable to amounts
recognised directly in equity are also recognised directly in equity.
Goods and Services Tax
Revenues, expenses and assets are recognised net of the amount
of GST except:
• Where the GST incurred on a purchase of goods and services
is not recoverable from the taxation authority, in which case
the GST is recognised as part of the cost of acquisition of
the asset or is part of the expense item as applicable; and
• Receivables and payables are stated with
the amount of GST included.
The net amount of GST recoverable from, or payable to, the
taxation authority is included as part of receivables or payables
in the statement of financial position.
Cash flows are included in the Statement of Cash Flows on a gross
basis and the GST component of cash flows arising from investing
and financing activities, which is recoverable from or payable to the
taxation authority, are classified as operating cash flows.
Commitments and contingencies are disclosed net of the
amount of GST recoverable from, or payable to, the taxation
authority.
F. Impairment of Non-financial assets
Assets that have an indefinite useful life, including Goodwill is
tested annually for impairment.
At each reporting date, the Group reviews the carrying amount of
all other non-financial assets to determine whether there is any
indication of impairment.
For impairment testing, assets are grouped together into the
smallest group of assets that generates independent cash inflows
(known as cash-generating units or CGUs). Goodwill arising from
a business combination is allocated to CGUs that are expected to
benefit from the synergies of the transaction.
The recoverable amount of an asset or CGU is the greater of its
value in use and its fair value less costs to sell. Value in use is
based on the estimated future cash flows, discounted to their
present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks
specific to the asset or CGU.
An impairment loss is recognised in profit or loss if the carrying
amount of an asset or CGU exceeds its recoverable amount.
G. Cash and Cash Equivalents
Cash and cash equivalents include 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, and bank
overdrafts. Bank overdrafts are shown within borrowings in current
liabilities on the Statement of Financial Position.
H. Receivables
Trade receivables are measured on initial recognition at fair value
and are subsequently measured at amortised cost using the
effective interest rate method. The Group applies the simplified
approach permitted by AASB 9 Financial Instruments, which
requires expected credit losses to be recognised from initial
recognition of the receivables. The expected credit losses are
estimated using a trade receivables aging matrix, based on the
Group’s historical credit loss experience.
I. Inventories
Inventory on hand has been recognised as follows:
• New and demonstrator motorcycles are stated at
the lower of cost and net realisable value. Costs are
assigned on the basis of specific identification.
• Used motorcycles are stated at the lower of cost and net
realisable value on a unit by unit basis. Net realisable value
has been determined by reference to the likely net realisable
value given the age of the motorcycle at year end. Costs
are assigned on the basis of specific identification.
• Spare parts and accessories are stated at the lower
of cost and net realisable value. Costs are assigned to
individual items on the basis of weighted average cost.
• Work in progress is stated at cost. Cost includes labour
incurred to date and consumables utilised during the service.
Costs are assigned to individual customers on the basis of
specific identification.
New Motorcycles and Related Bailment Finance
Motorcycles secured under bailment plans are provided to the
Group under bailment agreements between the floor plan loan
providers and entities within the Group. The Group obtains title to
the motorcycles immediately prior to sale. Motorcycles financed
under bailment plans held by the Group are recognised as trading
stock with the corresponding liability shown as owing to the
finance provider.
J. Fair Value Estimation
The fair value of financial assets and financial liabilities
must be estimated for recognition and measurement or for
disclosure purposes.
The fair value of financial instruments traded in active markets
(such as publicly traded derivatives and available-for-sale securities)
is based on quoted market prices at the balance date. The quoted
market price used for financial assets held by the Group is the
current bid price.
The fair value of financial instruments that are not traded in an
active market is determined using valuation techniques. The Group
uses a variety of methods and makes assumptions that are based
on market conditions existing at each balance date. Quoted market
prices or dealer quotes for similar instruments are used for long-
term debt instruments held. Other techniques, such as estimated
discounted cash flows, are used to determine fair value for the
remaining financial instruments. Fair values are categorised into
different levels in fair a value hierarchy based on the inputs used
in the valuation techniques as follows:
• Level 1: quoted prices (unadjusted) in active
markets for identical assets or liabilities
• Level 2: inputs other than quoted prices included in Level 1
that are observable for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from price)
• Level 3: inputs for the asset or liability that are not based
on observable market data (unobservable inputs)
The nominal value less estimated credit adjustments of trade
receivables and payables are assumed to approximate their fair
values. The fair value of financial liabilities for disclosure purposes
is estimated by discounting the future contractual cash flows at
the current market interest rate that is available to the Group for
similar financial instruments.
K. Property, Plant and Equipment
Plant and Equipment
Plant and equipment is measured initially at cost. Costs include all
directly attributable expenditure incurred including costs to get the
asset ready for its use as intended by management. Costs included
an estimate of any expenditure expected to be incurred at the end
of the asset’s useful life, including restoration, rehabilitation and
decommissioning costs (make good costs).
The following useful lives are used in the calculation of depreciation:
• Leasehold improvements 9 – 29 years
• Plant and equipment 3 – 15 years
• Furniture and fittings 3 – 15 years
• Motor vehicles 4 – 8 years
Subsequent costs are included in the asset’s carrying amount
or recognised as a separate asset, as appropriate, only when it is
probable that future economic benefits associated with the item
will flow to the group and the cost of the item can be measured
reliably. All other repairs and maintenance are charged to the
statement of profit or loss and other comprehensive income
during the financial period in which they are incurred.
Depreciation
The depreciable amount of all fixed assets is depreciated on either
a straight line or diminishing value basis over their useful lives
(commencing from the time the asset is ready for use). Leasehold
improvements are depreciated over the shorter of either the
unexpired period of the lease or the estimated useful lives of the
improvements.
The depreciable amount is the carrying value of the asset less
estimated residual amounts. The residual amount is based on what
a similar asset of the expected condition of the asset at the end of
its useful life could be sold for.
The assets’ residual values and useful lives are reviewed, and
adjusted if appropriate, at each balance sheet date.
Gains and losses on disposals are determined by comparing
proceeds with the carrying amount. These gains and losses are
included in the profit or loss.
37
MotorCyle Holdings Limited - Annual Report 2020
F inanc ia l S tatements ( cont inued)
Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
36
2. Significant Accounting Policies (continued)
L. Goodwill and Other Intangible Assets
Goodwill
Goodwill represents the excess of the cost of an acquisition
over the fair value of the Group’s share of the net identifiable
assets of the acquired subsidiary, associate or business at the
date of acquisition. Goodwill on acquisition of subsidiaries and
businesses is included in intangible assets. Goodwill on acquisition
of associates is included in investment in associates. Goodwill
acquired in business combinations is not amortised. Instead,
goodwill is tested for impairment annually, or more frequently
if events or changes in circumstances indicate that it might be
impaired and is carried at cost less accumulated impairment
losses. An impairment loss for goodwill is recognised immediately
in profit or loss and is not reversed in a subsequent period. Gains
and losses on the disposal of an entity include the carrying
amount of goodwill relating to the entity sold.
Goodwill is allocated to cash-generating units for the purpose of
impairment testing (refer Note 15).
Other Intangible Assets
Other intangible assets comprises:
Customer Contracts and Relationships and Other
Intangible Assets
These have been acquired by the Group through business
combinations and have finite useful lives. These were initially
measured at fair value less accumulated amortisation and
any accumulated impairment losses. Customer contracts and
relationships are amortised using the straight-line method over
10 years.
Trademarks
These have been acquired by the Group through business
combinations and have indefinite useful lives. These were initially
measured at fair value less accumulated impairment losses. As
the trademarks are renewable in nature, economically, the future
lives of the brand names are deemed indefinite. The Group
intends to continue using the acquired brand names for the
foreseeable future. These trademarks will be assessed annually
for impairment.
M. Trade and Other Payables
These amounts represent liabilities for goods and services provided
to the Group prior to the end of the financial year which are
unpaid. The amounts are unsecured and recognised initially at
the fair value of what is expected to be paid, and subsequently
at amortised cost, using the effective interest rate method.
N. Borrowings
Borrowings are initially recognised at fair value net of transaction
costs incurred. Borrowings are subsequently measured at
amortised cost. Any difference between the proceeds (net of
transaction costs) and the redemption amount is recognised
in profit or loss over the period of the borrowings using the
effective interest rate method.
Borrowings are classified as current liabilities unless the Group
has an unconditional right to defer settlement of the liability for
at least 12 months after the balance date.
O. Provisions
Provisions are recognised when the Group has a present obligation
(legal or constructive) as a result of a past event, it is probable
that the Group will be required to settle the obligation, and a
reliable estimate can be made of the amount of the obligation. The
amount recognised as a provision is the best estimate taking into
account the risks and uncertainties surrounding the obligation.
P. Employee Benefits
A liability is recognised for benefits accruing to employees in
respect of wages and salaries, annual leave and long service leave,
when it is probable that settlement will be required, and they are
capable of being measured reliably.
Liabilities recognised in respect of short-term employee benefits,
are measured at their nominal values using the remuneration rate
expected to apply at the time of settlement.
Liabilities recognised in respect of long-term employee benefits
are measured as the present value of the estimated future cash
outflows to be made by the Group in respect of services provided
by employees up to reporting date.
Contributions are made by the Group to defined contribution
employee superannuation funds and are charged as expenses
when incurred.
The grant-date fair value of equity-settled share-based payment
arrangements granted to employees is generally recognised as an
expense with a corresponding increase in equity over the vesting
period of the awards. The amount recognised as an expense is
adjusted to reflect the number of awards for which the related
service and non-market performance conditions are expected to
be met such that the amount ultimately recognised is based on
the number of awards that meet the relevant conditions at the
vesting date.
Q. Dividends
Provision is made for the amount of any dividend declared on or
before the end of the year but not distributed at balance date.
R. Earnings per Share
Basic Earnings per Share
Basic earnings per share is calculated as net profit attributable to
members of the parent, adjusted to exclude any costs of servicing
equity (other than dividends), divided by the weighted average
number of ordinary shares, adjusted for any bonus element.
Diluted Earnings per Share
Diluted earnings per share is calculated as net profit attributable
to members of the parent, adjusted for:
• Costs of servicing equity (other than dividends)
• The after-tax effect of dividends and interest associated
with dilutive potential ordinary shares that have been
recognised as expenses
• Other non-discretionary changes in revenues or expenses
during the period that would result from the dilution
of potential ordinary shares, divided by the weighted
average number of ordinary shares and dilutive potential
ordinary shares, adjusted for any bonus element.
S. Equity and Reserves
Ordinary Shares
Incremental costs directly attributable to the issue of the ordinary
shares are recognised as a deduction from equity. Income tax
relating to transaction costs of an entity transaction is accounted
for in accordance with AASB 112.
Share Based Payment Reserve
This reserve relates to the recognition of equity from equity-
settled share-based payment arrangements over the vesting
period of the awards.
T. Government Grants
Government grants are assistance by government in the form of
transfers of resources to an entity in return for past or future
compliance with certain conditions relating to the operating
activities of the entity.
Government grants are recognised at fair value when there is
reasonable assurance that the Company will comply with the
conditions attaching to them and the grants will be received.
Fair value is the amount for which an asset could be exchanged
between a buyer in an arm’s length transaction.
Government grants are presented in the consolidated statement of
profit or loss, under Other Income. Grants in recognition of specific
expenses are recognised in the consolidated statement of profit or
loss in the same period as the relevant expense.

3. Changes in Significant Accounting Policies
The Group has initially adopted AASB 16 Leases from 1 July 2019.
AASB 16 introduces a single, on-balance sheet accounting model for
lessees. As a result, the Group, as a lessee, has recognised right-of-
use assets representing its rights to use the underlying assets and
lease liabilities representing its obligation to make lease payments.
The Group has applied AASB 16 using the modified retrospective
approach, under which the cumulative effect of initial application
is recognised in retained earnings at 1 July 2019. Accordingly, the
comparative information presented for 2019 has not been restated –
i.e. it is presented, as previously reported, under AASB 117 and related
interpretations. The details of the changes in accounting policies are
disclosed below.
Definition of a Lease
Previously, the Group determined at contract inception whether
an arrangement was or contained a lease under IFRIC 4
Determining Whether an Arrangement contains a Lease. The
Group now assesses whether a contract is or contains a lease
based on the new definition of a lease. Under AASB 16, a contract
is, or contains, a lease if the contract conveys a right to control
the use of an identified asset for a period of time in exchange
for consideration.
On transition to AASB 16, the Group elected to apply the
practical expedient to grandfather the assessment of which
transactions are leases. It applied AASB 16 only to contracts that
were previously identified as leases. Contracts that were not
identified as leases under AASB 117 and Interpretation 4 were not
reassessed. Therefore, the definition of a lease under AASB 16
has been applied only to contracts entered into or changed on or
after 1 July 2019.
At inception or on reassessment of a contract that contains a
lease or lease component, the Group allocates the consideration
in the contract to each lease and non-lease component on the
basis of their relative stand-alone prices.
39
MotorCyle Holdings Limited - Annual Report 2020
F inanc ia l S tatements ( cont inued)
Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
38
3. Changes in Significant Accounting Policies (continued)
As a Lessee
The Group leases assets including properties and IT equipment. As a lessee, the Group previously classified leases as operating or finance
leases based on its assessment of whether the lease transferred substantially all of the risks and rewards of ownership. Under AASB 16, the
Group recognises right-of-use assts and lease liabilities for most leases – i.e. these leases are on balance sheet.
However, the Group has elected not to recognise right-of-use assets and lease liabilities for some leases of low-values assets (e.g. IT equipment).
The Group recognises the lease payments associated with these leases as an expense on a straight-line bases over the lease term.
The Group presents assets that do not meet the definition of investment property as ‘right-of-use assets.’ The carrying amounts of right-of-
use assets are as below.
Right of Use Assets
$’000
Balance at 1 July 2019 33,125
Balance at 20 June 2020 28,795
The Group presents lease liabilities separately to loans and borrowings in the statement of financial position.

Significant Accounting Policies
The Group recognises a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially
measured at cost, and subsequently at cost less any accumulated depreciation and impairment losses, and adjustments for subsequent
measurements of the lease liability.
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date,
discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group’s incremental borrowing
rate. Generally, the Group uses its incremental borrowing rate as the discount rate.
The lease liability is subsequently increased by the interest cost on the lease liability and decreased by lease payment made. It is
remeasured when there is a change in future lease payments arising from a change in an index or rate, a change in the estimate of the
amount expected to be payable under a residual value guarantee, or as appropriate, changes in the assessment of whether a purchase or
extension option is reasonably certain to be exercised or a termination option is reasonably certain not to be exercised.
Previously, leases in which a significant portion of the risks and rewards of ownership are retained by the lessor were classified as
operating leases. Payments made under operating leases (net of any incentives received from the lessor) were charged to profit or loss
on a straight-line basis over the period of the lease.
Transition
Previously, the Group classified property leases as operating leases under AASB 117. These include retail showroom and warehouse
facilities. The leases typically run for a period of five years. All leases include options to renew the lease for additional periods of five
years after the end of the non-cancellable period. Some leases provide for additional rent payments that are based on changes in local
price indices.
At transition, for leases classified as operating leases under AASB 117, lease liabilities were measured at the present value of the
remaining lease payments, discounted at the Group’s incremental borrowing rate as at 1 July 2019. Right-of-use assets are measured
at their carrying amount as if AASB 16 had been applied since the commencement date, discounted using the Group’s incremental
borrowing rate at the date of initial application.
The Group used the following practical expedients when applying AASB 16 to leases previously classified as operating leases under AASB 117:
• Applied the exemption not to recognise right-of-use assets and liabilities for leases with less than 12 months of lease term.
• Excluded initial direct costs from measuring the right-of-use asset at the date of initial application.
• Used hindsight when determining the lease term if the contract contains options to extend or terminate the lease.
Impacts on Financial Statements
Impacts on Transition
On transition to AASB 16, the Group recognised additional right-of-use assets, and additional lease liability, recognising the difference in retained
earnings. When measuring lease liabilities for leases that were classified as operating leases, the Group discounted lease payments using its
incremental borrowing rate at 1 July 2019. The weighted average rate applied is 3.24%. The impact on transition is summarised below.
1 July 2019
$’000
Right-of-use-assets 33,125
Deferred tax asset 610
Lease liabilities 35,161
Retained earnings (1,426)
1 July 2019
$’000
Operating lease commitments as at 30 June 20191 29,745
Adjustments as a result of a different treatment of extension and termination options 5,416
Lease Liabilities Recognised as at 1 July 2019 35,161
1 Discounted using the incremental borrowing rate at the date of the initial application
41
MotorCyle Holdings Limited - Annual Report 2020
F inanc ia l S tatements ( cont inued)
Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
40
4. Use of Judgements and Estimates
Estimates, assumptions and judgements are continually evaluated and are based on historical experience and other factors, including
expectations of future events that may have a financial impact on the Group and that are believed to be reasonable under the
circumstances.
The Group makes estimates, assumptions and judgements concerning the future. The resulting accounting estimates will, by definition,
seldom equal the related actual results. The estimates, assumptions and judgements that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities are discussed below:
Recoverable Amount of Goodwill and Other Intangible Assets
Goodwill with a carrying value of $77,499,000 (2019: $100,543,000) is tested annually for impairment, based on estimates made
by directors. Further information on the intangibles impairment test can be found in Note 15. For the purpose of impairment testing
conducted for the current year ended 30 June 2020 the recoverable amount has been based on fair value less cost of disposal.
Carrying Amount of Inventories
In determining the amount of write-downs of inventories, management has made judgements based on the expected net realisable
value. This requires certain judgements and assumptions to be made, including but not limited to historical loss experience, inventory
aging and current knowledge of the products.
COVID-19 Global Pandemic
Judgement has been exercised in evaluating the impact of COVID-19 on the financial statements. In particular, we considered the impact
on future cash flows included within our fair value less costs of disposal calculations used in impairment assessments and whether or
not there are material uncertainties that may cast significant doubt upon the Company’s ability to continue as a going concern.
Right of use assets and associated lease liabilities
The Group has initially adopted AASB 16 Leases from 1 July 2019. The Group has applied judgement to determine the lease term for some
lease contracts in which it is a lessee that include renewal options. The assessment of whether the Group is reasonably certain to exercise
such options impacts the lease term, which significantly affects the amount of lease liabilities and right-of-use assets recognised.
5. Operating Segment Information
Operating segments are identified based on internal reports that are regularly reviewed by the entity’s chief operating decision maker
in order to allocate resources to the segment and assess its performance. The Group operates in two operating and reporting segments
being Motorcycle Retailing and Motorcycle Accessories Wholesaling.
Motorcycle Retailing
The Group offers a diversified range of motorcycle products and services to the general public in Australia, including the sale of new and
used motorcycles, parts, servicing, accessories and mechanical protection plan contracts. The segment also facilitates insurance and
financing for motorcycle purchases through third-party sources.
Motorcycle Accessories Wholesaling
The Group imports and distributes a diversified range of motorcycle parts and accessories to wholesale customers in Australia, including
the Group’s own retail outlets.
Segment profit represents the profit earned by each segment without allocation of corporate head office costs and income tax. External
bailment financing and associated interest expense is allocated to Motorcycle Retailing.
For the purpose of monitoring segment performance and allocating resources between segments, the chief operating decision maker monitors
the tangible, intangible and financial assets attributable to each segment. All assets and liabilities are allocated to reportable segments.
Inter-segment transactions, which are eliminated on consolidation, are reported on a gross-basis, and are conducted on an arms’ length basis.
The Group is not reliant on any external individual customer for 10% or more of the Group’s revenue. The Group operates in one
geographical segment being Australia. Revenue from overseas customers is not material to the Group.
43
MotorCyle Holdings Limited - Annual Report 2020
F inanc ia l S tatements ( cont inued)
Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
42
5. Operating Segment
Information (continued) Motorcycle
Retailing
Motorcycle
Accessories
Wholesaling Eliminations
30 Jun 2020
$’000
30 Jun 2020
$’000
30 Jun 2020
$’000
Sales to external customers and other income 334,847 34,842 -
Inter-segment sales - 18,975 (18,975)
Total revenue and other income 334,847 53,817 (18,975)
Segment result
Operating profit before interest and impairment 22,312 5,868 -
Impairment loss - (24,296) -
External interest expense allocation (2,391) (1,489) -
Operating contribution 19,921 (19,917) -
Share of net profit of equity accounted investees (195) - -
Business acquisition costs (423) - -
Segment profit 19,303 (19,917) -
Unallocated corporate expenses
Profit before tax
Income tax expense
Net profit after tax
Depreciation and amortisation 9,408 3,780 -
Write down of inventories to net realisable value 1,670 308 -
Assets
Segment assets 183,774 76,365 -
Liabilities
Segment liabilities 108,024 27,526 -
Net Assets 75,750 48,839 -
Goodwill 50,243 27,256 -
Acquisition of non-current assets 1,097 117 -
Consolidated
Motorcycle
Retailing
Motorcycle
Accessories
Wholesaling Eliminations Consolidated
30 Jun 2020
$’000
30 Jun 2019
$’000
30 Jun 2019
$’000
30 Jun 2019
$’000
30 Jun 2019
$’000
369,689 297,137 32,750 - 329,887
- - 18,312 (18,312) -
369,689 297,137 51,062 (18,312) 329,887
28,180 7,859 8,595 - 16,454
(24,296) - - - -
(3,880) (1,299) (1,591) - (2,890)
4 6,560 7,004 - 13,564
(195) (77) - - (77)
(423) - - - -
(614) 6,483 7,004 - 13,487
(1,804) (1,440)
(2,418) 12,047
(6,702) (3,702)
(9,120) 8,345
13,188 1,477 2,313 - 3,790
1,978 391 (265) - 126
260,139 133,792 105,604 - 239,396
135,550 68,290 35,869 - 104,159
124,589 65,502 69,735 - 135,237
77,499 48,993 51,552 - 100,545
1,214 1,527 657 - 2,184
45
MotorCyle Holdings Limited - Annual Report 2020
F inanc ia l S tatements ( cont inued)
Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
44
6. Revenue
Disaggregation of Revenue
Motorcycle
Retailing
30 Jun 2020
$’000
Motorcycle
Accessories
Wholesaling
30 Jun 2020
$’000
Consolidated
30 Jun 2020
$’000
Motorcycle
Retailing
30 Jun 2019
$’000
Motorcycle
Accessories
Wholesaling
30 Jun 2019
$’000
Consolidated
30 Jun 2019
$’000
New motorcycles 129,425 - 129,425 111,187 - 111,187
Used motorcycles 95,243 - 95,243 85,980 - 85,980
Parts and accessories 75,457 34,842 110,299 72,463 32,451 104,914
Service 13,184 - 13,184 12,453 - 12,453
Other 437 - 437 520 - 520
313,746 34,842 348,588 282,603 32,451 315,054
At a point in time 311,386 34,842 346,228 281,480 32,451 313,931
Over time 2,360 - 2,360 1,123 - 1,123
313,746 34,842 348,588 282,603 32,451 315,054
Other Income
Finance and insurance Income 13,295 - 13,295 12,569 - 12,569
Government grants - JobKeeper
payment
5,977 - 5,977 - - -
Interest income 9 - 9 5 6 11
Income from equity accounted
investees
(195) - (195) (77) - (77)
Other income 2,015 - 2,015 2,038 292 2,330
21,101 - 21,101 14,535 298 14,833
Contract Balances
The following table provides information about receivables and contract liabilities from contracts with customers
30 Jun 2020
$’000
30 Jun 2019
$’000
Receivables, included in trade and other receivables 7,592 8,179
Contract liabilities 7,248 7,197
Revenue recognised from performance obligations satisfied or
partially satisfied in previous periods or partially satisfied in previous periods
2,986 2,701

Transaction Price Allocated to Remaining Performance Obligations
The following table includes revenue expected to be recognised in the future related to performance obligations that are unsatisfied
(or partially satisfied) at 30 June 2020.
Financial Year Ending
30 June 2021
$’000
30 June 2022
$’000
30 June 2023
$’000
30 June 2024
$’000
30 June 2025
$’000
30 June 2026
or later
$’000
Mechanical protection plans 3,264 2,203 1,209 442 120 8
3,264 2,203 1,209 442 120 8
7. Other Expenses 30 Jun 2020
$’000
30 Jun 2019
$’000
Other expenses
Advertising 2,404 2,416
Bank charges 992 1,060
Computers and software 955 928
Freight and cartage 1,253 1,270
Insurance 1,169 968
Motor vehicle expenses 1,588 1,753
Professional fees 1,161 829
Other expenses 4,268 4,451
13,790 13,675
Employee benefits expense
Salaries and wages 41,573 40,131
Superannuation contributions 4,882 4,673
Equity settled share-based payments 77 89
Other employee benefits expense 6,296 6,768
52,828 51,661
8. Finance Costs 30 Jun 2020
$’000
30 Jun 2019
$’000
Vehicle bailment 835 769
Bank interest expense 1,529 2,121
Interest attributable to leases 1,243 -
Foreign currency loss/(gain) 273
3,880 2,890
47
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F inanc ia l S tatements ( cont inued)
Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
46
9. Income Taxes 30 Jun 2020
$’000
30 Jun 2019
$’000
Income Tax Expense
Current income tax expense 5,845 3,876
Deferred income tax expense/(benefit) 857 (174)
6,702 3,702
Numerical reconciliation of income tax expense to prima facie tax payable
Profit/(loss) before income tax expense (2,418) 12,047
Tax at the Australian tax rate of 30% (2018: 30%) (725) 3,614
Tax effect of amounts which are not deductible (taxable) in calculating taxable income:
Non deductible expenses 7,397 88
Derecognition of prior year deferred tax asset 30
Income tax expense 6,702 3,702
Deferred tax
Deferred tax assets 15,188 6,544
Deferred tax liabilities (14,700) (5,891)
488 653
The balance comprises temporary differences attributable to:
Amounts recognised in profit or loss
Accrued income (717) -
Right of use assets (8,028) -
Property, plant and equipment 378 331
Inventory valuation (223) (150)
Provisions
- Doubtful debts 62 63
- Employee benefits 2,170 1,890
- Warranties 2,174 2,159
- Bonuses 177
Business combination costs 397 791
Lease liabilities 9,398 -
Other 105 369
Tax loses 408 941
6,301 6,394
30 Jun 2020
$’000
30 Jun 2019
$’000
Amounts recognised directly in equity
Other (610) -
(610) -
Amounts recognised directly in goodwill
Acquired employee entitlements / liabilities (82) -
Indefinite life intangibles (5,121) (5,741)
(5,203) (5,741)
Net deferred tax assets 488 653
The deferred tax expense included in income tax expense in respect of the above temporary
differences resulted from the following movements:
Opening balance at 1 July 653 (817)
Charged/(credited) to profit and loss (93) 174
Deferred tax recognised directly in equity (610) -
Deferred tax recognised directly in goodwill 538 1,296
Closing balance at 30 June 488 653
The tax rate used in the above reconciliations is the corporate tax rate of 30% payable by Australian corporate entities on taxable profits under Australian tax law.
There has been no change in the corporate tax rate when compared with the previous reporting period.

10. Earnings per Share 30 Jun 2020
Cents
30 Jun 2019
Cents
Basic earnings per share
Earnings attributable to the ordinary equity holders of the Company (14.8) 13.5
Diluted earnings per share
Earnings attributable to the ordinary equity holders of the Company (14.8) 13.5

Reconciliation of earnings used in calculating earnings per share $’000 $’000
Basic earnings per share
(Loss)/profit attributable to the ordinary equity holders of the company used in
calculating basic earnings per share
(9,120) 8,345
Diluted earnings per share
(Loss)/Profit attributable to the ordinary equity holders of the company used in
calculating diluted earnings per share
(9,120) 8,345
Weighted average number of ordinary shares outstanding during the year 61,707 61,707
Adjustments for calculation of diluted earnings per share – performance rights and options - 103
Weighted average number of ordinary shares outstanding during the year used in the
calculation of diluted earnings per share
61,707 61,810
49
MotorCyle Holdings Limited - Annual Report 2020
F inanc ia l S tatements ( cont inued)
Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
48
11. Cash and Cash Equivalents 30 Jun 2020
$’000
30 Jun 2019
$’000
Cash at bank and on hand 38,687 9,083
Short term deposits 807 92
39,494 9,175
12. Trade and Other Receivables 30 Jun 2020
$’000
30 Jun 2019
$’000
Trade and other receivables 7,798 8,387
Provision for doubtful receivables (206) (208)
7,592 8,179
13. Inventories 30 Jun 2020
$’000
30 Jun 2019
$’000
New and demonstrator motorcycles (at cost) 30,375 30,985
Less: write-down to net realisable value (285) (301)
New and demonstrator inventory 30,090 30,684
Used motorcycles (at cost) 6,701 12,268
Less: write-down to net realisable value (118) (204)
Used inventory 6,583 12,064
Parts, accessories and other consumables (at cost) 44,469 46,285
Less: write-down to net realisable value (6,717) (4,637)
Parts, accessories and other consumable inventory 37,752 41,648
Total inventories 74,425 84,396
14. Property, Plant and Equipment 30 Jun 2020
$’000
30 Jun 2019
$’000
Leasehold improvements
Gross value 9,939 9,295
Accumulated depreciation (3,172) (2,663)
6,767 6,632
Motor vehicles
Gross value 2,632 2,398
Accumulated depreciation (1,595) (1,363)
1,037 1,035
30 Jun 2020
$’000
30 Jun 2019
$’000
Plant and equipment
Gross value 7,402 6,667
Accumulated depreciation (5,191) (4,531)
2,211 2,136
Furniture, fixtures and fittings
Gross value 3,431 3,487
Accumulated depreciation (2,178) (2,000)
1,253 1,487
Other fixed assets
Gross value 1,344 1,334
Accumulated depreciation (1,148) (1,078)
196 256
Total property, plant and equipment 11,464 11,546
A reconciliation of the carrying amounts of each class of property, plant and equipment at the beginning and end of the year is set out below:
30 Jun 2020
Leasehold
improvements
$’000
Motor
Vehicles
$’000
Plant and
Equipment
$’000
Furniture,
Fixtures &
Fittings
$’000
Other
Fixed
Assets
$’000
Total
$’000
Carrying amount at the start of the period 6,632 1,035 2,136 1,487 256 11,546
Additions 547 120 403 132 11 1,213
Acquired from business combinations 99 207 119 65 2 492
Disposals/transfers - (32) 145 (179) - (66)
Depreciation expense (509) (295) (592) (254) (71) (1,721)
Carrying amount at end of period 6,769 1,035 2,211 1,251 198 11,464
30 Jun 2019
Leasehold
improvements
$’000
Motor
Vehicles
$’000
Plant and
Equipment
$’000
Furniture,
Fixtures &
Fittings
$’000
Other
Fixed
Assets
$’000
Total
$’000
Carrying amount at the start of the period 6,532 758 1,827 1,779 315 11,211
Additions 644 659 743 100 39 2,185
Acquired from business combinations - - - - - -
Disposals/transfers (131) (62) 88 (20) (1) (126)
Depreciation expense (413) (320) (522) (372) (97) (1,724)
Carrying amount at end of period 6,632 1,035 2,136 1,487 256 11,546
51
MotorCyle Holdings Limited - Annual Report 2020
F inanc ia l S tatements ( cont inued)
Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
50
15. Intangible Assets and Goodwill
A reconciliation of the carrying amount of goodwill and other intangible assets is set out below:
30 Jun 2020
Goodwill
$’000
Trademarks
$’000
Customer contracts
and relationships
$’000
Other
intangibles
$’000
Total
$’000
Cost
Balance at beginning of period 100,545 5,603 15,000 2,000 123,148
Acquired through business combinations 1,250 - - - 1,250
Balance at end of period 101,795 5,603 15,000 2,000 124,398
Accumulated amortisation & impairment
Balance at beginning of period - - (2,797) (667) (3,464)
Amortisation expense - - (1,667) (400) (2,067)
Impairment charge (24,296) - - - (24,296)
Balance at end of period (24,296) - (4,464) (1,067) (29,827)
Carrying amounts
Balance at beginning of period 100,545 5,603 12,203 1,333 119,684
Balance at end of period 77,499 5,603 10,536 933 94,571
30 Jun 2019
Goodwill
$’000
Trademarks
$’000
Customer contracts
and relationships
$’000
Other
intangibles
$’000
Total
$’000
Cost
Balance at beginning of period 103,290 5,603 15,000 2,000 125,893
Acquired through business combinations (2,745) - - - (2,745)
Balance at end of period 100,545 5,603 15,000 2,000 123,148
Accumulated amortisation & impairment
Balance at beginning of period - - (1,130) (267) (1,397)
Amortisation expense - - (1,667) (400) (2,067)
Balance at end of period - - (2,797) (667) (3,464)
Carrying amounts
Balance at beginning of period 103,289 5,603 13,870 1,733 124,495
Balance at end of period 100,545 5,603 12,203 1,333 119,684
Impairment Tests for Goodwill
For the purpose of impairment testing, goodwill is allocated to the Group’s two cash generating units (CGUs), being Motorcycle Retailing and
Motorcycle Accessories Wholesaling, which is consistent with the Group’s reportable segments.
Goodwill of $50,243,000 (2019: $48,993,000) is allocated to the Motorcycle Retailing CGU and Goodwill of $27,255,000 (2019: $51,552,000)
is allocated to the Motorcycle Accessories Wholesaling CGU
The recoverable amount of the CGU to which goodwill is allocated is determined based on the greater of its value in use and its fair value
less cost of disposal.
For the purpose of impairment testing conducted for the current year, the recoverable amount has been determined on a fair value less cost of
disposal basis. The fair value less cost of disposal assessment is conducted using a discounted cash flow (DCF) methodology requiring the
directors to estimate the future cash flows expected to arise from the cash generating units and then applying a discount rate to calculate
the present value (level 3 fair value). The DCF model adopted by the directors was based on the 2021 financial budget approved by
the Board. The key assumptions used in the estimate of the recoverable amount include:
Retail CGU Wholesale CGU
30 Jun 2020 30 Jun 2019 30 Jun 2020 30 Jun 2019
Pre-tax discount rate 13.2% 12.3% 14.5% 13.5%
Post-tax discount rate 9.5% 9.0% 10.5% 10.0%
Perpetual growth rate 2.5% 2.5% 2.5% 2.5%
Budgeted 0-1 year EBITDA growth rate -19.5% 0% 5.4% 0%
Budgeted 1-2 year EBITDA growth rate -29.5% 2.5% -0.8% 2.5%
Budgeted 3-5 year EBITDA growth rate 5.0% 5.0% 5.0% 5.0%
The discount rate was a post-tax measure estimated based on the historical industry weighted average cost of capital, with a possible debt
leveraging of 10% for the Wholesale CGU and 20% for the Retail CGU at a market interest rate of 4.8%. The discount rates used have been
increased from 9.0% to 9.5% in the retail CGU and from 10.0% to 10.5% in the wholesale CGU from the 31 December 2019 interim financial
statements. This is due to the increase in economic uncertainty due to the COVID-19 global pandemic.
Cash flow projections include specific estimates for five years and a terminal growth rate thereafter. The terminal growth rate was
determined based on management’s estimate of the long-term compound annual EBITDA growth rate, consistent with the assumptions that a
market participant would make.
Budgeted FY21 EBITDA growth rate was estimated taking into account past experience and adjusted as follows:
• New and Used bike sales were projected by taking into account the Group’s average sales levels experienced
over the past five years, adjusted for reduced sales in the uncertain economic climate;
• The effect of new dealerships and distribution rights were also taken into account; and
• Estimated cash outflow savings as a result of the Group’s cost saving measures initiated during April COVID-19 restrictions.
53
MotorCyle Holdings Limited - Annual Report 2020
F inanc ia l S tatements ( cont inued)
Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
52
15. Intangible Assets and Goodwill (continued)
FY22 to FY25 EBITDA growth rates were estimated taking into account past experience and expected industry trading conditions that do not
exceed past experience.
Due to current economic conditions and uncertainty in relation to the COVID-19 pandemic Directors have critically assessed recoverable
amounts and determined that goodwill was impaired for the year ended 30 June 2020 by $24,296,000 in the wholesale CGU. The estimated
recoverable amount of the retail CGU exceeded its carrying amount by $17,519,000.
The Group has determined that a reasonably possible change in the following assumptions could cause the carrying amount to exceed the
recoverable amount. The following table shows the amount by which these assumptions would need to change individually for the estimated
recoverable amount to be equal to the carrying amount:
Change required for the carrying amount to equal the recoverable amount
Retail Wholesale
30 Jun 2020 30 Jun 2019 30 Jun 2020 30 Jun 2019
Pre-tax discount rate +1.7% +1.0% 0% +0.2%
Perpetual growth rate -3.8% -2.1% 0% -0.3%
Budgeted 0-1 year EBITDA growth rate -8.0% -0.6% 0% -10.5%
Budgeted 1-2 year EBITDA growth rate -11.0% n/a 0% n/a
Budgeted 2-5 year EBITDA growth rate -13.2% n/a 0% n/a

16. Equity-accounted Investees 30 Jun 2020
$’000
30 Jun 2019
$’000
Interest in joint venture 3,164 3,539
3,164 3,539

The joint venture was established to provide secured loans to customers directly for the purchase of motorcycles.
MCF is structured as a separate entity and the Group has a residual interest in the net assets of MCF. Accordingly, the Group has classified
its interest in MCF as a joint venture. In accordance with the agreement under which MCF is established, the Group and the other investor in
the joint venture have agreed to make additional contributions to their interest to make up any losses, if required. This commitment has not
been recognised in these financial statements.
The following table summarises the financial information of MCF as included in its own financial statements, adjusted for fair value
adjustments at acquisition and differences in accounting policies. The table also reconciles the summarised financial information to the
carrying amount of the Group’s interest in MCF.
30 Jun 2020
$’000
30 Jun 2019
$’000
Percentage ownership interest 50% 50%
Assets
Cash and cash equivalents 3,248 4,321
Loans and receivables 59,263 43,122
Non-current assets 3,701 339
66,212 47,782
Lliabilities
Current liabilities 311 134
Non-current liabilities 59,574 40,570
59,885 40,704
Net assets 6,327 7,078
Group’s share of net assets (50%) 3,164 3,539
Carrying amount of interest in joint venture 3,164 3,539

Interest income 6,017 2,854
Other revenue 1,339 681
Interest expense 2,274 (1,158)
Income tax benefit/(expense) 69 32
Profit/(loss) after tax (390) (153)
Other comprehensive income/(loss) (361) (579)
Total comprehensive income (100%) (751) (732)
Group's share of total comprehensive income (50%) (376) (366)

17. Trade and Other Payables 30 Jun 2020
$’000
30 Jun 2019
$’000
Trade payables¹ 6,698 7,554
Other Payables 5,954 4,903
12,652 12,457
¹The average credit period on purchases of goods is 30 days. No interest is charged on trade payables from the date of invoice. The Group has financial risk management
policies in place to ensure that all payables are paid within the credit timeframe.
55
MotorCyle Holdings Limited - Annual Report 2020
F inanc ia l S tatements ( cont inued)
Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
54

18. Loans and Borrowings – Current 30 Jun 2020
$’000
30 Jun 2019
$’000
Bailment finance 27,602 28,883
Bank loan 3,000 1,667
30,602 30,550
Bailment finance is provided on a motorcycle by motorcycle basis by various finance providers and currently bears interest at a rate from
5-12% p.a. (2019: 5-12%). Bailment finance is considered a current liability and repayable after the motorcycle is sold to a third party.
This liability is represented by and secured by a charge over the vehicles subject to the bailment agreements and various levels of security
and indemnities.
19. Provisions 30 Jun 2020
$’000
30 Jun 2019
$’000
Employee benefits 6,380 5,692
Other provisions 79 -
Current provisions 6,459 5,692
Employee benefits 582 592
Other provisions - 856
Non-current provisions 582 1,448


20. Loans and Borrowings - Non Current 30 Jun 2020
$’000
30 Jun 2019
$’000
Bank loan 44,623 46,815
Total long term borrowings 44,623 46,815
Interest bearing loan is secured on a fixed and floating charge over the present and future interest of all assets and undertakings of the Group’s controlled entities.
The loan has a maturity date of 10 January 2023. The weighted average interest rate as at 30 June 2020 was 2.4015%.

Financing arrangements
The Group has access to the following lines of credit at balance date:
30 Jun 2020
$’000
30 Jun 2019
$’000
Total facilities
Bank facilities 51,973 68,977
Bailment finance 55,025 42,089
106,998 111,066
Used at balance date
Bank facilities 47,623 53,347
Bailment finance 27,602 28,883
75,225 82,230
Unused at balance date
Bank facilities 4,350 15,630
Bailment finance 27,423 13,206
31,773 28,836

21. Capital and Reserves
Ordinary Shares
Movements in ordinary shares Number of shares Issue Price $ $’000
Date Details
01 July 2018 Opening balance 61,706,710 120,081
30 June 2019 Closing balance 61,706,710 120,081
30 June 2020 Closing balance 61,706,710 120,081

57
MotorCyle Holdings Limited - Annual Report 2020
F inanc ia l S tatements ( cont inued)
Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
56
21. Capital and Reserves (continued)
Dividends
The following dividends were declared and paid by the Company:
30 June 2020
Cents per share
30 June 2020
$’000
30 June 2019
Cents per share
30 June 2019
$’000
Dividends on ordinary shares
2019 final dividend (2019: 2018 final dividend) - - 6.5 4,011
2020 interim dividend (2019: 2019 interim dividend) - - - -
Total Dividends on ordinary shares - - 6.5 4,011
Due to the improved trading conditions, your Directors have decided to declare a special dividend of 5 cents per share amounting to
$3,085,000 payable on 30 September 2020 with a record date of 9 September 2020.
The amount of franking credits available at the 30% tax rate as at 30 June 2020 to frank dividends for subsequent financial years, is
$40,878,247 (2019: $35,547,237).

22. Share-Based Payment Arrangements
During the 2018 financial year, the Group established a long-term incentive plan (“LTIP”) for key management personnel following shareholder
approval at the 2017 annual general meeting. The LTIP allows for the granting of performance rights which constitute a right to receive
ordinary shares in the capital of the Company upon the achievement of certain performance hurdles. The fair value of these performance
rights were calculated on grant date and recognised over the period to vesting. The vesting of the performance rights is based on the
achievement of specified compound annual growth in the Group’s earnings per share and relative total shareholder results.
The key terms and conditions related to the LTIP are as follows:
Grant Date
Number of
Performance
Rights Issued Vesting Conditions1 Performance Period
Tranche
2018 Tranche 1 24 April 2018 59,196 Relative TSR 1 July 2017 to 30 June 2020
2018 Tranche 2 24 April 2018 59,196 EPS CAGR 1 July 2017 to 30 June 2020
2019 Tranche 1 27 June 2019 55,956 Relative TSR 1 July 2018 to 30 June 2021
2019 Tranche 2 27 June 2019 55,956 EPS CAGR 1 July 2018 to 30 June 2021
2020 Tranche 1 26 June 2020 204,760 Relative TSR 1 July 2019 to 30 June 2022
2020 Tranche 2 26 June 2020 204,760 EPS CAGR 1 July 2019 to 30 June 2022
639,824
1 Further details of the vesting conditions are disclosed in the Remuneration Report.
Measurement of Fair Values
The fair value of the performance rights granted under the LTIP has been measured as follows:
• Tranche 1 – Monte Carlo simulation
• Tranche 2 – Black Scholes Model
Service and non-market performance conditions attached to the arrangements were not taken into account in measuring fair value.
The inputs used in the measurement of the fair values at grant date of the equity-settled share-based payments plans were as follows:
2020 - Tranche 1 2020 - Tranche 2 2019 - Tranche 1 2019 - Tranche 2
Fair value at grant date $1.41 $1.65 $0.20 $1.24
Share price at grant date $1.75 $1.75 $1.32 $1.32
Expected volatility 45% 45% 40% 40%
Annual dividend yield 2.41% 2.41% 2.92% 2.92%
Risk-free interest rate 0.75% 0.75% 1.10% 1.10%
Test date 30 June 2022 31 August 2022 30 June 2021 30 August 2021
The expected volatility has been based on an evaluation of the historical volatility of the Company’s and comparable companies’ share price,
particularly over the historical period commensurate with the expected term.
Reconciliation of outstanding performance rights
The number of performance rights under the LTIP were as follows:
Number of Performance Rights
30 June 2020 30 June 2019
Opening balance 212,577 118,394
Granted during the year 409,520 111,912
Forfeited during the year - (17,729)
Exercised during the year - -
Closing balance 622,097 212,577
Recognised share-based payments expense
The value of performance rights expensed during the year was $77,000 (2019: $89,000).
59
MotorCyle Holdings Limited - Annual Report 2020
F inanc ia l S tatements ( cont inued)
Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
58
23. Financial Instruments – Fair Value and Risk
Overview
The Group has exposure to the following key risks from its use of
financial instruments:
• Credit risk
• Liquidity risk
• Market risk
This note presents information about the Group’s exposure to
each of the above risks, the objectives, policies and processes for
measuring and managing risk, and the management of capital.
Further quantitative disclosures are included throughout these
consolidated financial statements.
The Board of Directors has overall responsibility for the establishment
and oversight of the Group’s risk management framework.
The Board has established an Audit and Risk Committee, which
is responsible for monitoring, assessing and reporting on the
consolidated entity’s risk management system. The committee
provides regular reports to the Board of Directors on its activities.
The Group’s risk management policies are established to identify
and analyse the risks faced by the consolidated entity, to set
appropriate risk limits and controls, and to monitor risks and
adherence to limits. Risk management policies and systems are
reviewed regularly to reflect changes in market conditions and the
consolidated entity’s activities.
The Audit & Risk Committee oversees how management monitors
compliance with the risk management policies and procedures
and reviews the adequacy of the risk management framework in
relation to the risks.
The Group’s principal financial instruments comprise bank loans,
bailment finance, cash and short-term deposits. The main purpose
of these financial instruments is to raise finance for and fund the
Group’s operations. The Group has various other financial instruments
such as trade debtors and trade creditors which arise directly from
its operations. It is, and has been throughout the period under review,
the Group’s policy that no speculative trading in financial instruments
shall be undertaken.
The main risk arising from the Group’s financial instruments are
market risk, credit risk and liquidity risk. The Board reviews and
agrees policies for managing each of these risks and they are
summarised below.
Credit Risk
Credit risk refers to the risk that a counterparty will default on its
contractual obligations resulting in a financial loss to the Group.
The Group has adopted a policy of only dealing with creditworthy
counterparties as a means of mitigating the risk of financial loss
from defaults. Further, it is the Group’s policy that all customers
who wish to trade on credit terms are subject to credit verification
procedures.
Trade receivables consist of a large number of customers, spread
across geographical areas. Ongoing credit evaluation is performed
on the financial condition of debtors and other receivable balances
are monitored on an ongoing basis, with the result that the Group’s
exposure to bad debts is not significant.
The Group establishes an allowance for doubtful debts that
represents its estimate of expected credit losses in respect of
trade and other receivables.
The Group’s credit risk on liquid funds is limited as the counter
parties are major Australian banks with favourable credit ratings
assigned by international credit rating agencies.
Exposure to Credit Risk
The carrying amount of financial assets (as per Note 12) represents the maximum credit exposure. The maximum exposure to credit risk as
the reporting date was:
Retail Segment Wholesale Segment
30 Jun 2020
$’000
30 Jun 2019
$’000
30 Jun 2020
$’000
30 Jun 2019
$’000
Trade and other receivables 2,640 3,951 5,158 4,436
Provision for doubtful receivables (97) (97) (109) (111)
2,543 3,854 5,049 4,325
Impairment losses
The maximum credit period on trade sales is 60 days. No interest is charged on the trade receivables from the date of invoice or when past due.
The Group applies a simplified approach to measure expected credit losses from trade receivables using an allowance matrix. Trade receivables
comprise a large number of small balances. These balances are allocated into different stages of delinquency between current and write-off.
Loss rates for each stage are then applied based on historical loss experience.
Included in the Group’s trade receivables balance are debtors with a carrying amount of $898,000 (2019: $519,000), which are past due at the
reporting date. Of this balance the Group has provided $206,000 (2019: $208,000) for these balances. The Group does not hold any collateral
over these balances.
Liquidity Risk
Liquidity risk is the risk that the consolidated entity will not be able to meet its financial obligations as they fall due. The consolidated
entity’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when
due, under both normal and stressed conditions.
The Group’s overall objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts and
bank loans.
The Group also manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities by continuously
monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities. Information on available
facilities can be found in Note 20.
Market Risk
Market risk is the risk that changes in market prices, such as interest rates, will affect the Group’s income or the value of its holdings of financial
instruments. The objective of market risk management is to manage and monitor market risk exposures within acceptable parameters, whilst
optimising the return on risk.
Interest Rate Risk
The Group is exposed to interest rate risk as a consequence of its financing facilities as set out in Notes 18 and 20. The Group’s policy is to
manage its interest cost using variable rate debt.
As at 30 June 2020 0% (2019: 0%) of the Group’s borrowings were at a fixed rate of interest, with all funds borrowed at floating rates. There
is no history of fixing interest rates and the Group has no intention of fixing interest rates in the immediate future.
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Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
60
23. Financial Instruments – Fair Value and Risk
(continued)
Interest Rate Sensitivity
The sensitivity analyses below have been determined based on
the exposure to interest rates at reporting date and the stipulated
change taking place at the beginning of the financial year and held
constant throughout the reporting period. A 50 basis point increase
or decrease is used when reporting interest rate risk internally to
key management and represents management’s assessment of the
possible change in interest rates.
At reporting date, if interest rates had been 50 basis points higher
or lower and all other variables were held constant, the Group’s
net profit after tax would increase/decrease by $217,000 (2019:
$242,000) per annum. This is mainly due to the Group’s exposures
to interest rates on its variable rate borrowings.
Foreign Currency Risk
The Group is exposed to currency risk to the extent that there is a
mismatch between the currency in which sales and purchases are
denominated and applicable functional currencies. The currency in
which these transactions are denominated is primarily the US dollar.
At any point in time, the Group uses forward exchange contracts
to hedge its purchases in respect of forecast sales and purchases
over the following six months, all with a maturity date of less than
one year from reporting date.
Capital Management
The Board’s policy is to maintain a strong capital base so as to
maintain investor, creditor and market confidence and to sustain
future development of the business.
The Board seeks to maintain a balance between the higher returns
that might be possible with higher levels of borrowings and the
advantages and security afforded by a sound capital position.
There were no changes in the Group’s approach to capital
management during the period.
Fair Value Measurements
The carrying amounts of trade receivables and payables are
assumed to approximate their fair values due to their short-term
nature. The fair value of financial liabilities for disclosure purposes
is estimated by discounting their future contractual cash flows at
the current market interest rate that is available to the Group for
similar financial instruments. The fair value of current borrowings
approximates the carrying value amount, as the impact of
discounting is not significant.
Maturity Profile
The below table provides a maturity profile for the Group’s
financial liabilities at balance date. The amounts disclosed in the
table are gross contractual undiscounted cash flows (principal
and interest) required to settle the respective liabilities. The
interest rate is based on the rate applicable as at the end of the
financial period.

As at 30 June 2020
Less than
1 year
$’000
1-2 Years
$’000
2-5 Years
$’000
5+ Years
$’000
Total
$’000
Interest
Rate
Financial liabilities
Bailment (current) 27,602 - - - 27,602 5-12%
Borrowings 4,127 4,081 44,934 - 53,142 2.40%
Lease liabilities 11,255 6,850 11,700 4,349 34,154
Forward exchange contracts
- outflow 4,025 - - - 4,025
- inflow (3,768) - - - (3,768)
Trade and other payables 12,652 - - - 12,652
55,893 10,931 56,634 4,349 127,807
As at 30 June 2019
Less than
1 year
$’000
1-2 Years
$’000
2-5 Years
$’000
5+ Years
$’000
Total
$’000
Interest
Rate
Financial liabilities
Bailment (current) 28,883 - - 28,883 5-12%
Borrowings 3,437 47,386 - 50,823 3.94%
Forward exchange contracts
- outflow 3,598 - - 3,598
- inflow (3,598) - - (3,598)
Trade and other payables 12,457 - - 12,457
44,777 47,386 - - 92,163
24. List of Subsidiaries
All subsidiaries are either directly controlled by MotorCycle Holdings Limited or are wholly owned within the group, have ordinary class of
shares and are incorporated in Australia.
Name of Entity
Place of
Incorporation
Equity Held
30 Jun 2020
%
Equity Held
30 Jun 2019
%
Cassons Pty Ltd Australia 100 100
Innovative Dealership Solutions Pty Ltd Australia 100 100
Innovative Dealership Solutions Unit Trust Australia 100 100
Motor Cycle Accessories Supermarket Pty Ltd Australia 100 100
Motorcycle Holdings Group Unit Co Pty Ltd Australia 100 100
Motorcycle Holdings Group Unit Trust Australia 100 100
Motorcycle Holdings IDS Pty Ltd Australia 100 100
Motorcycle Holdings Operations Pty Ltd Australia 100 100
Motorcycle Holdings TCO Pty Ltd Australia 100 100
Motorcycle Holdings Unit Co Pty Ltd Australia 100 100
Motorcycle Riding School Pty Ltd Australia 100 100
MW Motorcycles Pty Ltd Australia 100 100
Myway Services Pty Ltd Australia 100 100
Netpark Pty Ltd Australia 100 100
North Ride Pty Ltd Australia 100 100
Pushgate Pty Ltd Australia 100 100
Shoreway Pty Ltd Australia 100 100
Stanbay Pty Ltd Australia 100 100
Team Moto Pty Limited Australia 100 100
TeamMoto Unit Trust Australia 100 100
Trinder Avenue Motors Pty Ltd Australia 100 100

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Notes to and Forming Par t o f the Conso l idated
F inanc ia l S tatements
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62
25. Parent Entity
Information relating to MotorCycle Holdings Limited (‘the parent entity’) at 30 June 2020 is presented below and is in line with the Group’s
accounting policies.
Financial position
30 Jun 2020
$’000
30 Jun 2019
$’000
Assets
Current assets - 2,095
Non-current assets 123,235 119,060
123,235 121,155
Liabilities
Current liabilities 2,057 -
Non-current liabilities - -
2,057 -
Equity
Issued capital 120,083 120,083
Retained earnings 841 895
Reserves 254 177
121,178 121,155
Financial performance
Profit/(loss) for the year (54) 7,948
Total comprehensive income (54) 7,948

26. Deed of Cross Guarantee
MotorCycle Holdings Limited, the parent entity, has entered into a Deed of Cross Guarantee with each of its eligible wholly owned
subsidiaries, under which each entity guarantees the debts of other members of the Group. By entering into this Deed of Cross
Guarantee it allows the Group to use ASIC Corporations (Wholly owned Companies) Instrument 2016/785 which provides relief from the
Corporations Act 2001 financial reporting requirements for wholly owned subsidiaries.
The table in note 24 details the Group’s corporate structure and those entities that are wholly owned and form part of the Group’s Deed
of Cross Guarantee. There are no material differences in the financial statements for the amounts disclosed for the consolidated entity,
and the aggregated amounts for all entities within the Deed of Cross Guarantee.

27. Business Combinations
The Group completed the following business combinations as part of its growth strategy:
Date Name Type Location
18 October 2018 Northside Harley-Davidson Certain business assets and liabilities Brunswick, Victoria
1 November 2018 Canberra Motorcycle Centre Certain business assets and liabilities Fyshwick, ACT

The business combinations contributed revenue of $22,861,000 and net profit after tax of $435,000 for the year ended 30 June 2020 from
their dates of acquisition.
The Group would have reported $403,173,000 in consolidated revenue and $8,473,000 in consolidated net loss after tax for the year ended
30 June 2020 had the business combinations occurred at the beginning of the reporting period.
Below is a summary of the total purchase consideration, net identifiable assets acquired, and goodwill recognised from these business
combinations:
Total
$’000
Inventory – motorcycles (net of bailment) 299
Inventory – parts and accessories 1,198
Property, plant and equipment 492
Other assets 27
Total assets acquired 2,016
Trade and other payables 94
Employee entitlements 191
Total liabilities assumed 285
Net identifiable assets acquired 1,731
Goodwill recognised 1,250
Net assets acquired 2,981
Purchase consideration – cash 2,581
Purchase consideration – deferred 400
Total purchase consideration – cash 2,981
The goodwill recognised is attributable to the workforce, profitability of the acquired business and the expected operational synergies with
the Group’s existing motorcycle dealerships. None of the goodwill recognised is expected to be deductible for tax purposes.
28. Contingencies
Parent Entity
Unsecured guarantees, indemnities and undertakings have been given by the parent entity in the normal course of business in respect
of financial and trade arrangements entered into by its subsidiaries. It is not anticipated that the parent entity will become liable for any
amount in respect thereof. At 30 June 2020 no subsidiary was in default in respect of any arrangement guaranteed by the parent entity.
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F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
64
29. Leases
The Group leases retail and warehouse facilities. The leases run for periods between 3 and 10 years, with options to renew the leases
after those dates. Lease payments are renegotiated at the exercise of each option period to reflect market rates. Some leases provide
for additional rent payments that are based on changes in local price indices. For certain leases, the Group is restricted from entering
into any sub-lease arrangements. Information about leases is presented below.
Right-of-use Assets
Right-of-use assets related to leased properties that do not meet the definition of investment property are presented separately on the
balance sheet.
$’000
Balance at 1 July 2019 33,125
Depreciation charge for the year (9,401)
Additions to right-of-use assets 5,071
Balance at 30 June 2020 28,795

Amounts recognised in profit or loss
$’000
30 June 2020 - Leases under AASB 16
Interest on lease liabilities 1,243
30 June 2019 - Operating leases under AASB 17
Rent expense 10,026
Amounts recognised in statement of cash flows
30 June 2020
$’000
Total cash outflow for leases 10,933

Extension of options
Some property leases contain extension options exercisable by the Group up to six months before the end of the non-cancellable contract
period. Where practicable, the Group seeks to include extension options in new leases to provide operational flexibility. The extension options
held are exercisable only by the Group and not by the lessors. The Group assesses at lease commencement date whether it is reasonably
certain to exercise the extension options. The Group reassesses whether it is reasonably certain to exercise the options if there is a
significant event or significant changes in circumstances within its control.
30. Auditor’s Remuneration
KPMG Australia
30 Jun 2020
$
30 Jun 2019
$
Audit or review of the financial report 343,600 305,000
Other services 83,100 107,181
426,700 412,181
31. Related Parties
The remuneration report included in the Directors’ Report sets out the remuneration policies of the consolidated entity and the relationship
between these policies and the consolidated entity’s performance.
Compensation of key management personnel
The aggregate compensation made to key management personnel of the Company and the Group is set out below:
30 Jun 2020
$
30 Jun 2019
$
Short term employee benefits 1,276,943 2,059,396
Share-based payments 194,990 47,709
Post employment benefits 103,710 160,239
Other long term benefits 13,822 104,136
1,589,465 2,371,480
There are no loans to key management personnel.
Other transactions of directors and director related entities
The aggregate amount of transactions with key management personnel are as follows:
(i) The Group has entered into leases in respect to 11 properties that are controlled by David Ahmet, Managing Director and Chief Executive
Officer, or that are part-owned by entities controlled by David Ahmet.
The terms of these leases were negotiated on commercial arms’ length basis in 2011 and contain customary terms and conditions
including an initial lease term of 5 years, with options to renew for a further 15 years (comprising 3 options for 5-year periods). The
lease term expired on 30 June 2016 and options have been exercised for the first of three 5-year options to extend them. The leases
are subject to a formal market review at each option renewal.
Total rental payments (excluding outgoings) payable to related parties for the year ended 30 June 2020 was $1,828,000 (year ended
30 June 2019: $2,436,000).
Total undiscounted liabilities recognised in lease liabilities under AASB 16 as at 30 June 2020 in respect to the 11 properties that are
owned by entities controlled by David Ahmet was $1,924,000.
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F inanc ia l S tatements
MotorCyle Holdings Limited - Annual Report 2020
66
31. Related Parties (continued)
(ii) The Group has entered into leases in respect to three properties that are owned by entities controlled by Rob Cassen, Non-executive
Director, or that are part-owned by entities controlled by Rob Cassen.
The terms of these leases were originally negotiated on commercial arms’ length basis in July 2011, December 2012 and July 2013 and
each contain customary terms and conditions including initial lease terms of 10 years, with options to renew each lease for a further
10 years. The leases are subject to a formal market review at each option renewal.
Total rental payments (excluding outgoings) payable to related parties for the year ended 30 June 2020 was $2,584,000 (2019:
$2,558,000).
Total undiscounted liabilities recognised in lease liabilities under AASB 16 as at 30 June 2020 in respect to the three properties that
are owned by entities controlled by Rob Cassen was $3,922,000.
Other related parties
The Group is entitled to finance commission revenue from its joint venture, MCF (refer Note 16). Total finance revenue recognised by the
Group for the year ended 30 June 2020 was $2,194,000 (2019: $2,364,000), of which $127,000 (2019: $155,000) was receivable at year end.

32. Reconciliation of Cash Flows from Operating Activities 30 Jun 2020
$’000
30 Jun 2019
$’000
Net profit after tax (9,120) 8,345
Add/(less) non-cash movements
Depreciation and amortisation 3,787 3,790
Impairment expense 24,296 -
(Profit)/loss from equity-accounted investee 195 77
Equity settled share-based payment 77 89
(Increase)/decrease in assets
Receivables 626 (1,371)
Inventories 11,468 3,026
Deferred tax assets 775 642
Increase/(decrease) in liabilities
Payables (329) 551
Bailment finance liability (1,281) 4,506
Provisions 775 1,172
Taxes payable 4,234 (1,826)
Net cash inflow from operating activities 35,503 19,001

33. Subsequent Events
There continues to be significant uncertainty relating to the future impacts of the pandemic, with a number of states still experiencing high
case numbers. There has been no significant impact of the pandemic on the Group’s operations subsequent to 30 June 2020 but management
continue to closely monitor the potential impacts on the Group.
Directors’ Declaration
The Directors make the following Directors’ Declaration for the year ended 30 June 2020:
1. In the opinion of the Directors of MotorCycle Holdings Limited (the Company):
(a) the consolidated financial statements and notes that are set out on pages 28 to 66 and the Remuneration report in the Directors’
report, are in accordance with the Corporations Act 2001, including:
I. giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its performance for the financial year
ended on that date; and
II. complying with Australian Accounting Standards and the Corporations Regulations 2001;
(b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.
2. There are reasonable grounds to believe that the Company and the group entities identified in Note 24 will be able to meet any obligations
or liabilities to which they are or may become subject to by virtue of the Deed of Cross Guarantee between the Company and those
group entities pursuant to ASIC Corporations (Wholly-owned Companies) Instrument 2016/785.
3. The directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the Chief Executive Officer
and Chief Financial Officer for the financial year ended 30 June 2020.
4. The directors draw attention to Note 2 to the consolidated financial statements, which includes a statement of compliance with
International Financial Reporting Standards.

Signed in accordance with a resolution of the directors:



David Ahmet
Managing Director
Dated at Brisbane this 27th day of August 2020
David Foster
Chair
Dated at Brisbane this 27th day of August 2020
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Liability limited by a scheme approved
under Professional Standards
Legislation.
KPMG, an Australian partnership and a member
firm of the KPMG network of independent member
firms affiliated with KPMG International Cooperative


To the shareholders of MotorCycle Holdings Limited
Report on the audit of the Financial Report

Opinion
We have audited the Financial Report of
MotorCycle Holdings Limited (the
Company).
In our opinion, the accompanying
Financial Report of the Company is in
accordance with the Corporations Act
2001, including:
• giving a true and fair view of the
Group's financial position as at 30
June 2020 and of its financial
performance for the year ended on
that date; and
• complying with Australian Accounting
Standards and the Corporations
Regulations 2001.

The Financial Report comprises:
• Consolidated statement of financial position as at 30
June 2020;
• 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;
• Notes including a summary of significant accounting
policies; and
• Directors' Declaration.
The Group consists of the Company and the entities it
controlled at the year-end or from time to time during the
financial year.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
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 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 fulfilled our other ethical responsibilities in accordance with the
Code.



Independent Auditor’s Report







Key Audit Matters
The Key Audit Matters we identified
are:
• Recoverability of goodwill; and
• Valuation of inventory.
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.
Recoverability of goodwill ($77,499,000)
Refer to Note 15 to the Financial Report
The key audit matter How the matter was addressed in our audit
A key audit matter for us was the Group’s annual
testing of goodwill for impairment, given the size
of the balance (being 30% of total assets) and
the significantly higher estimation uncertainty
continuing from the business disruption impact
of the COVID-19 global pandemic. We focused
on the significant forward-looking assumptions
the Group applied in their fair value less costs of
disposal models, including:
• Forecast operating cash flows, growth rates
and terminal growth rates – the Group has
experienced unusual trading conditions
driven by government stimulus policies
associated with COVID-19. This impacted the
Group through increased demand for
products, however there is uncertainty in
how long increased demand will continue.
These conditions increase the risk of
inaccurate forecasts or a wider range of
possible outcomes for us to consider.
• Forecast growth rates and terminal growth
rates – in addition to the uncertainties
described above, the Group’s models are
sensitive to small changes in these
assumptions. This drives additional audit
effort specific to their feasibility and
consistency of application to the Group’s
strategy.
• Discount rates – these are complicated in
nature and vary according to the conditions
Our procedures included:
• Considering the appropriateness of the fair
value less costs of disposal method used by the
Group in performing the annual test of goodwill
for impairment against the requirements of the
accounting standards.
• Assessing the integrity of the fair value less
costs of disposal models used, including the
accuracy of the underlying calculation formulas.
• Meeting with management to understand the
impact of COVID-19 on the Group and the
impact of government response programs to
the FY20 results.
• Comparing the forecast cash flows contained in
the models to Board approved forecasts.
• Assessing the accuracy of previous Group
forecasts to inform our evaluation of forecasts
incorporated in the models. We noted previous
trends where constrained market conditions
existed and how they impacted the business,
for use in further testing.
• Assessing the Group’s determination of CGU
assets for consistency with the assumptions
used in the forecast cash flows and the
requirements of the accounting standards.
• Working with our valuation specialists, we
challenged the Group’s forecast cash flow and
growth assumptions in light of current uncertain
trading conditions. We applied increased





Liability limited by a scheme approved
under Professional Standards
Legislation.
KPMG, an Australian partnership and a member
firm of the KPMG network of independent member
firms affiliated with KPMG International Cooperative


To the shareholders of MotorCycle Holdings Limited
Report on the audit of the Financial Report

Opinion
We have audited the Financial Report of
MotorCycle Holdings Limited (the
Company).
In our opinion, the accompanying
Financial Report of the Company is in
accordance with the Corporations Act
2001, including:
• giving a true and fair view of the
Group's financial position as at 30
June 2020 and of its financial
performance for the year ended on
that date; and
• complying with Australian Acc nting
Standards and the Corporations
Regulations 2001.

The Financial Report comprises:
• Consolidated statement of financial position as at 30
June 2020;
• 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;
• Notes including a summary of significant accounti g
policies; and
• Directors' Declaration.
The Group consists of the Company and the entities it
controlled at the year-end or from time to time during the
financial year.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
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 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 fulfilled our other ethical responsibilities in accordance with the
Code.



Independent Auditor’s Report

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and environment the specific Cash
Generating Unit (CGU) is subject to from
time to time, and the models approach to
incorporating risks into the cash flows or
discount rates. The Group’s modelling is
sensitive to small changes in the discount
rate.
The Group’s impairment models use adjusted
historical performance and a range of internal and
external sources as inputs to the assumptions.
Modelling, using forward-looking assumptions,
tends to be prone to greater risk for potential
bias, error and inconsistent application. These
conditions necessitate additional scrutiny by us,
in particular to address the objectivity of sources
used for assumptions, and their consistent
application.
In addition to the above:
• The carrying amount of the net assets of the
Group exceeded the Group’s market
capitalisation at year end, increasing the
possibility of goodwill being impaired;
• The total recoverable amount of CGUs
exceeded the Group’s market capitalisation
at year end; and
• The Group recorded an impairment charge of
$24.3m against goodwill in the Wholesale
CGU.
These factors increased our audit effort in this
area.
We involved valuation specialists to supplement
our senior audit team members in assessing this
key audit matter.
scepticism to forecasts in the areas where
previous forecasts were not achieved. We
compared forecast growth rates and terminal
growth rates to external market data, and
considered differences for the Group’s
operations. We used our knowledge of the
Group, their past performance, business and
customers, and our industry experience.
• Working with our valuation specialists, we
independently developed a discount rate range
considered comparable using publicly available
market data for comparable entities, adjusted by
risk factors specific to the Group and the
industry it operates in.
• Considering the sensitivity of the models by
varying key assumptions, such as forecast
operating cash flows, forecast growth rates,
terminal growth rates and discount rates, within
a reasonably possible range. We did this to
identify those CGUs at higher risk of impairment
and to focus our further procedures.
• Working with our valuation specialists in
assessing the Group’s analysis of the market
capitalisation shortfall versus the total
recoverable amount of all CGUs. This included
consideration of the market capitalisation range
implied by recent share price trading ranges, to
the Group’s latest internal enterprise valuation
model.
• Recalculation of the impairment charge against
the recorded amount disclosed.
• Assessing the disclosures in the financial report
using our understanding of the issue obtained
from our testing and against the requirements
of the accounting standards.






Valuation of inventory ($74,425,000)
Refer to Note 13 to the Financial Report.
The key audit matter How the matter was addressed in our audit
The valuation of new and used motorcycle
inventory and parts and accessories inventory is a
key audit matter due to:
• The size of the balance (comprising 29% of total
assets); and
• The high level of judgement required by us in
evaluating the Group’s assessment of
recoverability based on age, brand, condition
and historical sales data, together with higher
estimation uncertainty arising from the business
disruption impact of the COVID-19 global
pandemic.
These judgements included the assumptions
underlying the provision for inventory
obsolescence calculations and determination of
net realisable value across each class of inventory
with reference to the above mentioned attributes,
amongst others.
In assessing this key audit matter, we involved
senior members of the audit team who collectively
understand the Group’s business, industry and the
economic environment in which it operates.
Our procedures included:
• Considering the appropriateness of inventory
valuation accounting policies applied by the Group
against the requirements of accounting standards.
• Developing an understanding of the Group’s
processes and judgements adopted in determining
the provisions for obsolescence for each class of
inventory.
• Tracing the age and cost of inventory at 30 June
2020, on a sample basis, to underlying purchase
documents, as key inputs into the Group’s
assessment of provisions for obsolescence.
• Assessing the adequacy of the Group’s judgements
in estimating net realisable value through the
following:
– Comparing the carrying value of new and used
motorcycles and parts and accessories, on a
sample basis, to current sales values; and
– Assessing the level of provisioning for new and
used motorcycles and parts and accessories, on
a sample basis, with reference to historical sales
data and write-offs.

Other Information
Other Information is financial and non-financial information in MotorCycle Holdings Limited’s annual
reporting which is provided in addition to the Financial Report and the Auditor’s Report. The Directors are
responsible for the Other Information.
Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not
express an audit opinion or any form of assurance conclusion thereon, with the exception of the
Remuneration Report and our related assurance opinion.
In connection with our audit of the Financial Report, our responsibility is to read the Other Information. In
doing so, we 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.
We are required to report if we conclude that there is a material misstatement of this Other Information,
and based on the work we have performed on the Other Information that we obtained prior to the date of
this Auditor’s Report we have nothing to report.

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Responsibilities of the Directors for the Financial Report
The Directors are responsible for:
• preparing the Financial Report that gives a true and fair view in accordance with Australian Accounting
Standards and the Corporations Act 2001;
• implementing necessary internal control to enable the preparation of a Financial Report that gives a
true and fair view and is free from material misstatement, whether due to fraud or error; and
• assessing the Group and Company's ability to continue as a going concern and whether the use of the
going concern basis of accounting is appropriate. This includes disclosing, as applicable, matters
related to going concern and using the going concern basis of accounting unless they either intend to
liquidate the Group and Company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the Financial Report
Our objective is:
• 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 Australian Auditing Standards will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error. They are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of the Financial Report.
A further description of our responsibilities for the audit of the Financial Report is located at the Auditing
and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of our
Auditor’s Report.







Report on the Remuneration Report
Opinion
In our opinion, the Remuneration
Report of MotorCycle Holdings
Limited for the year ended 30 June
2020, complies with Section 300A of
the Corporations Act 2001.
Directors’ 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 responsibilities
We have audited the Remuneration Report included in pages
16 to 25 of the Directors’ Report for the year ended 30 June
2020.
Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.



KPMG Simon Crane
Partner

Brisbane
27 August 2020



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MotorCyle Holdings Limited - Annual Report 2020
F inanc ia l S tatements ( cont inued)
Add i t iona l I n fo rmat ion
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74
Additional Information as at 24 August 2020
Corporate Governance Statement
The Company’s Corporate Governance Statement can be found at www.mcholdings.com.au/page-1000/
Substantial Shareholders
The names of substantial holders in the Company, the number of securities in which each substantial holder and the substantial holder’s
associates have a relevant interest as disclosed in substantial holding notices given to the Company and listed on the ASX website and the
percentage of total issued capital are:
1. MotorCycle Holdings Limited (shares held by employees and their Associates) holding 17,215,537 shares or 27.9% of the total
issued capital.
2. David Hedley Ahmet holding 11,288,994 shares at 18.29% of the total issued capital.
3. Bennelong Australian Equity Partners Pty. Ltd. (Bennelong Funds Management Group) holding 7,570,091 shares at 12.27%
of the total issued capital.
4. Auscap Asset Management Limited holding 4,230,000 shares at 6.86% of the total issued capital.
5. Mitsubishi UFJ Financial Group, Inc. holding 4,088,218 shares at 6.63% of the total issued capital.
6. Renaissance Smaller Companies Pty Ltd holding 3,245,880 shares at 5.26% of the total issued capital.

Voting Rights
Each shareholder present at a meeting has one vote on a show of hands, and if a poll is called each shareholder present votes in proportion
to the number of and amount paid up on their shares.
Ordinary Shares
Distribution of equity security holders by size of holding:
Range Total Holders Units % Units
1 - 1,000 318 147,353 0.24
1,001 - 5,000 592 1,667,913 2.70
5,001 - 10,000 280 2,083,140 3.38
10,001 - 100,000 254 6,831,284 11.07
100,001 Over 37 50,977,020 82.61
Total 1,481 61,706,710 100.00
Unmarketable Parcels
Minimum Parcel Size Holders Units
Minimum $ 500.00 parcel at $1.9200 per unit 261 107 8,084
Escrowed Shares
Nil.
Securities Exchange
The Company is listed on the Australian Securities Exchange. The home exchange is Sydney.
Other Information
MotorCycle Holdings Limited is incorporated and domiciled in Australia, is a publicly listed company limited by shares.
On-Market Buy-Back
There is no current on-market buy-back.
Twenty Largest Shareholders
Top twenty holders (ungrouped) of ordinary fully paid shares:
Rank Name Units % Units
1 CITICORP NOMINEES PTY LIMITED 12,657,788 20.51
2 HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED 7,188,509 11.65
3 GREENSLIDE PTY LTD 6,300,000 10.21
4 KENLAKE PTY LIMITED 4,179,394 6.77
5 NATIONAL NOMINEES LIMITED 3,561,815 5.77
6 FREDA CASSEN 3,181,819 5.16
7 R CASSEN PTY LTD (R CASSEN FAMILY A/C) 3,181,819 5.16
8 J P MORGAN NOMINEES AUSTRALIA PTY LIMITED 2,992,201 4.85
9 MR BRUCE ROLAND COLLINS 839,610 1.36
10 MR ROBERT JOHN DONOVAN & MS CORINA LEE TROY (DONOVAN FAMILY S/F A/C) 598,052 0.97
11 DAVID HEDLEY AHMET 581,596 0.94
12 MRS KAREN ANN COOKSLEY 575,001 0.93
13 MR ROBERT BRUCE TINLIN 499,785 0.81
14 MR MARTIN JOHN POCOCK & MRS MICHELLE JUNE POCOCK (POCOCK FAMILY A/C) 385,291 0.62
15 MR CHRISTOPHER ANDREW CHENOWETH 338,938 0.55
16 DR DAVID JOHN RITCHIE + DR GILLIAN JOAN RITCHIE (D J RITCHIE SUPER FUND A/C) 306,600 0.50
17 BANJO SUPERANNUATION FUND PTY LTD (P D EVANS PSF A/C) 283,545 0.46
18 NEWECONOMY COM AU NOMINEES PTY LIMITED (900 ACCOUNT) 254,686 0.41
19 MRS TANYA MAREE SHIPARD 218,750 0.35
20 HANCROFT PTY LTD 217,646 0.35
Totals: Top 20 holders of ORDINARY FULLY PAID SHARES (Total) 48,342,845 78.34
Total Remaining Holders Balance 13,363,865 21.66

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MotorCyle Holdings Limited - Annual Report 2020
F inanc ia l S tatements ( cont inued)
Add i t iona l I n fo rmat ion
MotorCyle Holdings Limited - Annual Report 2020
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Leases with Related Parties
Certain MotorCycle Holdings Group entities have entered into leases in respect of properties that are part-owned by David Ahmet
(Managing Director) or that are part-owned by entities owned and controlled by David Ahmet. The Company was granted the following
waiver from listing rule 10.1 to the extent necessary to permit the Company not to seek shareholder approval for the first renewal period
of 5 years, commencing on 1 July 2016 (the “First Renewal Period”), of property leasing agreements entered into between the Company
on behalf of Triumph Virginia, Moorooka Service Centre, Triumph Springwood, Honda Springwood, Advanced Spray Painting and Decals,
Team Moto Virginia, Team Moto Moorooka, Yamaha Gold Coast, Team Moto North Coast and Team Moto Blacktown and properties that
are part-owned by Company director and substantial shareholder David Ahmet or that are part-owned by Kenlake Pty Ltd, an entity
owned and controlled by David Ahmet (the “Ahmet Leases”) on the following conditions.
i. Summaries of the material terms of the Ahmet Leases are made in each annual report of the Company during the life of the
Ahmet Leases.
ii. Any material variation to the terms of the Ahmet Leases is subject to shareholder approval.
iii. Renewal of the Ahmet Leases, including the exercise of any subsequent option to renew the Ahmet Leases for a further term of
5 years after the completion of the First Renewal Period, will be subject to shareholder approval, should listing rule 10.1 apply at
that time.
The terms of these leases were negotiated on commercial arms’ length basis in 2011 and contain customary terms and conditions
including an initial lease term of 5 years, with options to renew for a further 15 years (comprising 3 options for 5-year periods). Options
to renew were exercised on 1 July 2016. The annual value of the rent under the leases is set out in Note 30 to the Financial Statements.
As a result of the acquisition of Cassons Pty Ltd, the Group has entered into leases in respect to three properties that are owned by
entities owned and controlled by Rob Cassen (Executive Director), or that are part-owned by entities owned and controlled by Rob
Cassen at Cassons Warehouse, Motor Cycle Accessories Supermarket Penrith and Motor Cycle Accessories Supermarket Caringbah.
The terms of these leases were originally negotiated on commercial arms’ length basis in July 2011, December 2012 and July 2013
and each contain customary terms and conditions including initial lease terms of 10 years, with options to renew each lease for a
further 10 years.

CORPORATE DIRECTORY
Registered Office MotorCycle Holdings Limited
68 Moss Street
Slacks Creek QLD 4127
Tel: +61 7 3380 2235
Email: nicole.spink@mcholdings.com.au
ASX Ticker Code MTO
Directors David Foster
David Ahmet
Warren Bee
Rick Dennis
Peter Henley
Rob Cassen
Chief Financial Officer Bob Donovan CPA
Company Secretary Nicole Spink FCPA FGIA FCG(CS)
Auditor KPMG
Level 16
Riparian Plaza
71 Eagle Street
Brisbane QLD 4000
Location of Share
Registry
Computershare Investor Services Pty Ltd
Level 1
200 Mary Street
Brisbane QLD 4000
Tel (within Australia): 1300 850 505
Tel (outside Australia): +61 3 9415 4000
Website: computershare.com.au
Website www.mcholdings.com.au
MotorCyle Holdings Limited - Annual Report 2020
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