What Brambles does:
Brambles’ platforms form the invisible backbone
of global supply chains. Through its CHEP brand,
Brambles primarily serves the fast-moving
consumer goods, fresh produce, beverage,
retail and general manufacturing industries.
Its circular business model facilitates the
‘share and reuse’ of the world’s largest pool
of reusable pallets, crates and containers.
This enables Brambles to serve its customers
while minimising impacts on the environment
and improving the eciency and safety
of supply chains around the world.
As a pioneer of the sharing economy,
Brambles is one of the world’s most
sustainable logistics businesses.
The world’s largest brands trust
Brambles to help them transport the
goods that matter more eciently,
safely and sustainably.
Brambles’ purpose is to
connect people with life’s
essentials, every day.
As at 30 June 2023, Brambles:
Operated in...
~60
countries
Owned...
~353 million
pallets, crates
and containers
Employed...
~12,000
people
Through a network of…
750+
service centres
About this Report
Brambles recognises that transparent reporting is an essential part of its responsibility to its shareholders and other stakeholders,
and to maintain its social licence to operate.
Integrated Reporting
Brambles’ leading approach to reporting and disclosure references best practice frameworks, including the Financial Stability Board’s
Task Force on Climate-related Financial Disclosures (TCFD), the Global Reporting Initiative and the International Financial Reporting
Standards Foundation framework, which combines the Integrated Reporting <IR> ‘capitals’ framework and the Sustainable Accounting
Standards Board (SASB) standards. The Annual Report on pages 1 to 33 has been prepared with reference to the <IR> Framework to
illustrate the interaction and interdependencies between a business’s sources of value, its model and its ability to create value over
time. SASB industry-specic sustainability indicators will be available on Brambles’ website from mid-September 2023.
This holistic approach to reporting and disclosure aims to help Brambles’ stakeholders understand its sources of value, including
resource dependencies and the positive and negative impacts of its business on these sources of value. Brambles also follows the
guidance provided by the TCFD voluntary disclosure framework. Brambles’ FY23 TCFD disclosure, within the Annual Report, provides
a summary of how we consider governance, risk management, strategy, metrics and targets in relation to climate change. This will
be supported by a TCFD supplement on Brambles’ website.
All acronyms and terminology referred to in this report are dened in the Glossary on pages 141 to 143.
Forward‑Looking Statements
Certain statements made in this report are “forward-looking statements” – that is, statements related to future, not past, events.
Words such as “anticipates”, “expects”, “intends”, “plans”, “believes”, “seeks”, “estimates”, “will”, “should” and similar expressions
are intended to identify forward-looking statements. These forward-looking statements are not historical facts, but rather are
based on Brambles’ current beliefs, assumptions, expectations, estimates and projections. Forward-looking statements are not
guarantees of future performance, as they address matters that are uncertain and subject to known and unknown risks and other
factors that are beyond the control of Brambles, are dicult to predict and could cause actual results to differ materially from
those expressed or forecast in the forward-looking statements. Brambles cautions shareholders and prospective shareholders
not to place undue reliance on these forward-looking statements, which reect the views of Brambles only as of the date of this
report. The forward-looking statements made in this report relate only to events as of the date on which the statements are made –
Brambles will not undertake any obligation to release publicly any revisions or updates to these forward-looking statements to reect
circumstances or events occurring after the date of this report, except as may be required by law or by any appropriate regulatory
authority. Past performance cannot be relied on as a guide to future performance.
Brambles Limited
ABN 89 118 896 021
Resilience & Regeneration
In a Year marked by ongoing uncertainty
and volatility, Brambles has demonstrated
the quality and inherent resilience of
its business as well as the increasing
importance of its ambitious regeneration
agenda. Through its transformation
programme, Brambles is investing to further
strengthen the resilience and performance
of its current business while building the
‘Brambles of the Future’. This underpins
Brambles’ strategy of providing a step
change in the value it creates for customers,
employees and shareholders and allowing
it to deliver on its ambition of pioneering
regenerative supply chains.
Contents
Brambles at a Glance 1
Letter from the Chair and CEO 3
Operating & Financial Review 6
Board & Executive Leadership Team 40
Directors’ Report – Remuneration Report 47
Directors’ Report – Additional Information 67
Shareholder Information 72
Consolidated Financial Report 74
Independent Auditor’s Report 133
Auditor’s Independence Declaration 139
Five-Year Financial Performance Summary 140
Glossary 141
To view the Group’s annual review
for FY23, go to:
brambles.com/ar2023
Brambles 2023 Annual Report 1Brambles at a Glance
Letter from the Chair & CEO
We are extremely proud of what we have achieved this Year. Our teams
around the world have worked hard, improving pallet availability and
service levels to keep customers’ goods owing across their supply
chains. At the same time, we delivered impressive nancial and
sustainability outcomes while investing in the future success of the
business. Our ambitious transformation and regeneration agendas
continue to progress, strengthening our competitive advantage and
underpinning the long-term sustainability and value creation potential
of our business.
In a Year marked by macroeconomic
uncertainty and persistent cost pressures,
we have demonstrated the quality and
inherent resilience of our business.
Combined with the benets of our
transformation programme, this has
enabled us to deliver strong nancial
results and to support our customers
better as we collectively navigate
an ever evolving environment.
Among the most notable developments has
been the improvement in pallet availability
during the second half of the Year, allowing
us to remove allocation protocols across
our major markets and improve customer
service levels in all regions. These
improvements reect a combination of the
benets of our asset productivity initiatives,
investment in our asset pool and evidence
of progressive inventory optimisation by
retailers and manufacturers.
Although inationary pressures persist,
we have begun to see improvements
in the cost and availability of some key
elements to delivering pooling solutions
to our customers, including lumber
in all geographies and transport in
North America. As a result of improved
global lumber availability, the capital cost of
new pallets in most regions has also begun
to moderate from the record levels reported
in the second half of FY22.
While uncertainty remains about the
broader economic outlook, input-cost
ination and overall supply chain dynamics,
we are condent that we can grow our
business and successfully navigate these
challenges. This will allow us to continue
delivering for our customers, shareholders,
employees and other stakeholders over the
medium to long term.
This condence is underpinned by a strong
growth pipeline in our major markets and
structural improvements already made
to increase our agility in responding to
rapid changes in our customers’ needs,
the cost environment and operating
conditions more broadly. These include
better alignment of commercial terms to
the cost-to-serve, increased productivity
across our operations and our pallet pool,
as well as improvements in our customer
value proposition.
These changes and our disciplined
approach to capital allocation have already
been integral in delivering our investor
value proposition this Year, with total
shareholder value creation exceeding
the stated objective of above 10%, with
EPS growth of 26%
2
and a dividend yield
of ~3%. This was supported by double-
digit revenue growth with Underlying Prot
leverage and positive Free Cash Flow
after dividends while generating strong
return on capital for shareholders. We are
particularly pleased to have delivered these
outcomes while strengthening our global
leadership position in sustainability and
continuing to invest for the future through
our transformation programme.
FY23 Financial Performance
Our sales revenue for the Year increased
14% on a constant-currency basis and
reected our pricing discipline and
improved commercial terms in both current
and prior-year periods to recover signicant
cost-to-serve increases, including record
levels of ination in pallet prices and other
input-cost increases.
Our volume performance remained
challenged primarily due to pallet
availability constraints, particularly in the
rst half of the Year, slowing underlying
consumer demand for our customers’
products owing to macroeconomic
pressures and some inventory optimisation
across global supply chains.
With pallet availability improving across
North America and Europe in the second
half of the Year, our teams have been
actively pursuing new business. Pleasingly,
we have already started to see early signs
of success with new business wins in
both the US and Europe, supporting our
condence in the value our share and reuse
solutions can unlock across customers’
supply chains.
Underlying Prot for the Year increased
19% at constant currency as strong pricing
more than offset input-cost ination and
incremental overhead investments to
support the transformation programme.
In FY23, we saw the return to strong
positive Free Cash Flow generation
after a number of years of signicant
pallet price ination. Despite higher
cash capital expenditure this Year due
to the impact of payments for pallets
purchased in the prior year at elevated
prices, we delivered Free Cash Flow
after dividends of US$180 million. This
outcome reected increased pricing to
recover the cost-to-serve and the combined
benet of asset eciency initiatives,
working capital improvements and some
progressive inventory optimisation across
supply chains. With Free Cash Flow after
dividends positive, we are now focused on
driving successive years of sustainable
Free Cash Flow generation combined with
Resilience &
Regeneration
Financial
Sales Revenue
US$6,076.8m
Up 14% at constant currency
1
Underlying Prot
US$1,067.0m
Up 19% at constant currency
1
Return on Capital Invested
18.5%
Up 0.5 percentage points at constant currency
1
Cash Flow from Operations
US$789.8m
Up US$398.0m
Total Dividends
26.25 US ¢/share
Final dividend of 14.00 US cents per share
Safety
Brambles Injury Frequency Rate (BIFR)
3.8
Down from 4.1 in FY22
Sustainability
1st in industry category
Maximum AAA rating
Top 9% of companies
assessed in our
industry category
3rd most sustainable
company of ~7,000 analysed
Top ‘A’ rating in Forests
and Climate submission
‘A’ score over the
last two years
Top Employer status
globally, and across four
regions and 25 countries
Highlights
1 Current period results (excluding hyperinationary economies) translated into US dollars at the actual monthly exchange rates applicable in the comparable period,
so as to show relative performance between the two periods. Results for hyperinationary economies are not retranslated and remain at their reported actual exchange
rates (period-end spot exchange rates). 2 At constant currency.
3Letter from the Chair & CEO2 Brambles 2023 Annual Report
Leveraging the benets of our low-carbon
business model is the foundation of
Brambles’ climate mitigation strategy.
Introducing more customers to a
circular share and reuse system results
in lower environmental impacts in
their supply chains. Building on this is
our comprehensive decarbonisation
programme which has yielded a 5.2%
reduction in greenhouse gases across
Scope 1, 2 and 3 emission sources and
positive progress against our veried
science-based 2030 targets. This is not
only delivering eciencies for our business
but is educating our supply chain teams
to integrate sustainability analysis into
their decision making and business
planning processes.
Our leadership position in sustainability
was at the centre of two essential funding
initiatives undertaken by Brambles during
the Year. Specically, we accessed a
US$1.35 billion sustainability-linked
revolving credit facility with pricing
connected to performance across four
key sustainability metrics linked to our
published targets. We also issued a
€500 million green bond with a 4.25%
coupon rate that was strongly supported by
sustainability focused investors.
We received numerous ESG recognitions
during the Year, covering many aspects
of our sustainability programme,
demonstrating excellent performance
against our most material ESG goals. Our
results in the Dow Jones Sustainability
Index, CDP Forests and CDP Climate
Change and Global Top Employer
certication, coupled with our internal
employee engagement results, highlight
the dedication of our people to making
our regenerative vision a reality. We look
forward to sharing more information
around our sustainability progress in the
2023 Sustainability Review, due for release
in September 2023.
Dividends
The strong earnings performance by
Brambles during the Year, has also
beneted shareholders with the Board
declaring total dividends for FY23 of 26.25
US cents per share, an increase of 15% over
the prior year. This represents an Australian
dollar equivalent of 39.50 Australian cents
per share. The Board has also increased the
payout ratio for FY23 to 55% reecting the
strong balance sheet and liquidity position
as well as the return to positive Free Cash
Flow generation in FY23.
The non-underwritten Dividend
Reinvestment Plan (DRP) remains in
place for shareholders. The DRP will
not attract a discount and any dilutive
impacts on earnings per share will be
neutralised. Shareholders wishing to
participate in the DRP should conrm
their election status before 5pm Sydney
time on Friday 15 September 2023 with
Brambles Limited’s Share Registrar,
Boardroom Pty Limited.
Board Renewal and
CFO Succession
In line with our Board renewal plan, we
appointed Priya Rajagopalan in November
2022 as a North American-based
Non-Executive Director. Priya has over
two decades of experience in product
management, marketing and strategy,
most recently in digital platforms for
global supply chains. Priya brings detailed
knowledge and experience of digital based
supply chain product development and
marketing. With Priya’s appointment,
we have now exceeded our FY25 target of
40% female representation on the Board.
In February this year, Nessa O’Sullivan
informed the Board of her intention to
step down as Chief Financial Ocer (CFO)
and as an Executive Director of Brambles.
Following a thorough process to nd a
successor, with both internal and external
candidates being considered, we are
delighted to announce that Joaquin Gil,
currently Deputy CFO of Brambles,
will succeed Nessa as CFO and join
Brambles’ Executive Leadership Team on
13 October 2023.
Joaquin joined Brambles in 2019 as CFO
of CHEP Europe and held the role of Group
Vice President of Financial Planning &
Analysis before being appointed Deputy
CFO of Brambles in June this year. During
his time at Brambles, Joaquin has played
a key role in delivering the Shaping Our
Future transformation, particularly the
asset eciency initiatives across the
Group. Prior to joining Brambles, Joaquin
held senior nance and management roles
with Coca-Cola Amatil and Keurig Green
Mountain, and has worked in Australia,
Indonesia, Mexico and the UK. He holds a
Bachelor of Commerce from the University
of Canberra and is a Member of the Institute
of Chartered Accountants, Australia and
New Zealand.
To ensure a smooth transition, Nessa
will be staying on in an advisory role until
31 January 2024. On behalf of the Board,
we want to thank Nessa for her outstanding
contribution over the past seven years.
She has been instrumental in delivering our
strategy and moving our company forward
during a period of signicant volatility.
We wish her all the best for the future.
Full Board biographies are on
pages 40 to 43. Details of our Board
Skills Matrix are in the 2023 Corporate
Governance Statement on brambles.com.
Outlook
Subject to there being no material change
in economic and operating conditions,
in FY24 we expect to deliver in constant
currency, sales revenue growth between
6-8%, Underlying Prot growth between
9-12% and positive Free Cash Flow before
dividends of between US$450-550 million.
These nancial outcomes are dependent
on a number of factors, including material
unknowns. These factors include, but are
not limited to, prevailing macroeconomic
conditions, customer demand, the price of
lumber and other key inputs, the eciency
of global supply chains, including the extent
of destocking, and movements in FX rates.
Conclusion
We are proud of our achievements this
Year, including the progress made across
the transformation programme to improve
the resilience of the business, as well as
delivering another Year of strong nancial
performance and a strengthened leadership
position in sustainability. This would not be
possible without the energy and drive our
people bring every day, to deliver positive
outcomes for our customers in uncertain
and challenging times.
On behalf of the Board, we would like to
thank our ~12,000 employees for their
efforts during the Year and Brambles’
shareholders for their continued support.
John Mullen
Chair
Graham Chipchase
Chief Executive Ocer
Letter from the Chair & CEO continued
delivery of operating leverage, in line with
our investor value proposition.
The ability to consistently deliver this
outcome will be supported by the
investments to transform our business
through our Shaping Our Future
transformation programme.
Accelerating
Transformation Benets
The progress of our transformation has
improved the performance and resilience of
our business, setting a strong foundation
for us to enhance our customer value
proposition and our commercial business
model. This is being achieved through
leveraging investments in technology and
data analytics combined with automation
and platform innovations to provide
superior pooling solutions to support our
customer and investor value propositions,
while also delivering on our ambitious
sustainability agenda.
Delivering an excellent customer experience
and creating additional value for our
customers is integral to our success. We are
seeing early signs of improvements in our
customer engagement and satisfaction
scores as a result of better pallet availability
and investments to improve our systems
and deliver additional insights to our
customers. In addition, we are currently
trialling several innovative digital initiatives
that leverage our unique position in the
supply chain to remove waste from our
customers’ operations.
Signicant progress has also been made
in our asset eciency with an additional
~10 million pallets recovered and salvaged
this Year through various asset productivity
improvements. There are multiple benets
to the business including reducing our
demand on natural resources, improving
customer pallet availability and delivering
positive nancial outcomes.
Importantly, these outcomes are being
enabled by our digital transformation which
has already started delivering business
improvements by supporting commercial
decision making, greater visibility and
control of our assets and identifying new
sources of value for our customers.
By continuing to raise our data and analytics
capabilities across the organisation, we
have also expanded our ability to generate,
capture and analyse information, which we
can convert to insights that improve the
eciency of our customers’ supply chains
and our own operations.
This has been further enhanced by the
deployment of pallet tracking technology
including through our continuous
diagnostics trials in North America and
the UK. We have now deployed ~450,000
autonomous tracking devices in over 30
countries that have collectively created
one billion data readings and uniquely
tagged approximately one million pallets in
Chile with QR codes. Using enhanced data
analytics, we have turned this data into
information and insights to improve our
operations and asset control practices.
We continue to test, learn and adapt our
approach to deploying and extracting value
from smart assets while assessing the
potential for these technologies to be scaled
in other regions based on successful pilots.
As the transformation programme
progresses, we remain disciplined and
exible in how capital is deployed to
optimise value. Our decision to revise
downwards the number of automated
repair process installations across the
network from 70 to 50 by the end of FY25
reects changes in the current operating
environment and macroeconomic
conditions and our disciplined approach
to capital allocation. Accordingly, we
have identied alternative and less
capital intensive projects to generate the
eciency benets originally attributable
to the 20 automated repair process
installations not being pursued.
We will apply the same rigour and
transparency to all transformation
investments, with trials a key part of our
methodology to stage-gate investments
and adapt our plans depending on trial
outcomes and identication of new
opportunities. Scaling of investments will be
conditional on clear links to value creation
and supporting the delivery of our customer
and investor value propositions.
The key streams and activities during
the Year have been summarised on
pages 10 and 11.
We are condent the continued progress of
our transformation programme will generate
sustainable value over the long term for our
customers, shareholders and employees as
well as take us one step closer to pioneering
regenerative supply chains.
Pathway to Regeneration
This Year delivered progress towards our
2025 sustainability targets, the increased
recognition of the importance of integrating
nancial and sustainability processes
and greater acknowledgement of the
inherent resilience of Brambles’ circular
business model.
Our vision to become a regenerative and
nature-positive business is evident through
practical actions such as our expanding
reforestation initiatives and launching
more reusable plastic products made with
upcycled post-consumer materials. A prime
example is our FY25 Forest Positive target,
which is to enable the sustainable growth
of two trees for every tree we require
for our timber pallets by FY25. We have
started actions on large-scale projects
with partners in Mexico and Zambia, while
separately in CHEP South Africa, we have
successfully enabled the sustainable
growth of 3.85 million additional trees.
Critically, these initiatives have been
co-designed with the respective local
communities resulting in nature-centric
economic pathways that connect the
restoration of forests to their livelihoods,
while in the case of Mexico, also securing
future certied lumber sources for our
business. It is initiatives like this that
illustrate how regenerative programmes
can deliver practical outcomes for people,
business and the planet.
We are equally proud of our commitment to
diversity, equity and inclusion, as evidenced
by our increased representation of women
in leadership roles, which is now 36%.
Our Workplace Positive programmes also
go beyond gender equity with safety being
a key focus area. It is pleasing to see the
Brambles Injury Frequency Rate (BIFR)
decrease for the fourth year, reducing to
3.8, which represents a 24% improvement
against our FY21 baseline.
Our circular business model, reinforced
by our sustainability programme, has
demonstrated unparalleled resilience in
the face of multiple challenges this Year,
including severe weather events which have
increased across our network as the impact
of climate change intensies.
Brambles is approaching the dynamic
challenge of climate change, and its
impacts, through a complementary
strategy of adaptation and mitigation.
The highlights of this work are shared on
pages 20-22. During this period, we initiated
a comprehensive analysis of the potential
climate-related physical risks to material
parts of our network and sourcing supply
chains. This will inform regional-specic
climate adaptation plans for our service
centres that will be integrated into our
business continuity planning programmes.
With the assistance of external expertise
and climate modelling, we have initiated
a programme to gain a better understanding
of the potential forestry-specic impacts
from climate change across our diverse
materials sourcing portfolio.
54
Brambles 2023 Annual Report Letter from the Chair & CEO
Circular
‘Share and Reuse’
Model
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SOCIAL AND
RELATIONSHIP
CAPITAL
Customer-driven environmental savings:
Enhances operational efficiency, freeing up cash and resources,
lowers overall supply chain costs
1
1.9m
tonnes of CO
2
-e
4,276
megalitres
of water
3.1m
cubic metres
of wood
3.0m
trees
NATURAL
CAPITAL
OUTPUTS
INPUTS VALUE CREATION
Our people's knowledge,
expertise and ability
to innovate
Brambles' network
knowledge and
proprietary systems,
enable its circular
business model
HUMAN
CAPITAL
INTELLECTUAL
CAPITAL
Strong relationships
with customers,
communities, industry
and regulators
SOCIAL AND
RELATIONSHIP
CAPITAL
Pool of funds available
to Brambles to invest in
operations (includes
debt, equity and profits)
FINANCIAL
CAPITAL
353m
assets shared and
reused throughout the
world’s supplychains
MANUFACTURED
CAPITAL (PALLETS,
CRATES AND
CONTAINERS)
NATURAL
CAPITAL
100%
wood from
certified sources
INTELLECTUAL
CAPITAL
FINANCIAL
CAPITAL
Attracting leading talent in a competitive environment.
Generating new ideas and innovations to enhance our circular business model
Network advantage and digital solutions are creating the supply chains of the future
HUMAN
CAPITAL
Growth, innovation and people
Network scale density and expertise
Scale-related operational efficiencies
US$0.3b Dividends paid to shareholders
US$1.0b Employee costs including taxes
US$0.2b Income taxes paid
US$0.1b Interest paid on loans
US$3.4b Payments to suppliers
Economic Value Generated
2
: US$6.1b
Economic Value Retained
3,4
: US$1.7b
Economic Value Distributed: US$5.0b
1.2m
tonnes
of waste
1 The United Nations Sustainable Development Goals (SDGs) are a set of 17 interconnected goals that form a global benchmark for achieving a sustainable future for all.
While many of the SDGs intersect with Brambles’ operations, the SDG it assesses as most material to its operations is SDG 12 – Responsible Consumption and Production.
2 Group sales revenue.
3 Group cash capital expenditure.
4 Under normalised conditions, the ‘economic value retained’ is approximately equal to the ‘economic value generated’ less the ‘economic value distributed’. In FY23 these
amounts do not reconcile due to lumber ination on group cash capital expenditure, surcharge income and pallet compensations.
For regional economies and communities, Brambles provides
income for local suppliers, generating ongoing demand and
supporting local employment, and offers nancial donations
to community groups such as food banks.
On a national scale, Brambles’ contributions through taxes to
governments help redistribute prosperity and promote equality.
More information on how Brambles manages its tax obligations
and the tax contributions it makes to the countries in which it
operates can be found in Brambles 2023 Tax Transparency Report,
which will be published in the second half of calendar year 2023.
For the environment, Brambles’ commitment to regenerate more
than it needs and provide its products via a service helps reduce
the pressure on natural capital, including forest ecosystems
and the climate, while reducing the resource waste associated
with conventional single-use, linear business models.
For other industries, Brambles demonstrates the nancial
viability of a truly circular business model on a global scale.
In an increasingly resource, climate and nature-conscious world,
low-carbon, circular business models represent a practical
pathway to balance the needs of people and the planet. Brambles’
advocacy on the benets of a circular economy provides a
template for other industries and governments to examine
and adopt circular strategies and regulations to accelerate
the achievement of the 2030 UN Sustainable Development
Goals (SDGs).
In these ways, Brambles creates value for a wide range
of stakeholders while delivering life’s essentials every day,
in a nature and people-positive way.
For shareholders and debt investors, Brambles provides an
investment pathway and exposure to the low-carbon, circular
economy that delivers sustainable growth at returns well in excess
of the cost of capital. Its model generates sucient cash ow
through the cycle to fund dividends and support reinvestment
in growth, innovation, and the development of its people.
For its ~12,000 employees in approximately 60 countries,
Brambles provides a safe and inclusive work environment with
exciting career opportunities. By fostering a culture of innovation
and agility, Brambles seeks to attract, retain and develop the talent
to shape a sustainable future and deliver value for customers,
shareholders and communities around the world.
This is underpinned by strong nancial performance,
which provides direct value for Brambles’ employees through
employment and associated non-nancial benets, for their
families and communities.
Brambles’ regenerative vision seeks to create positive outcomes
for communities, economies and the environment on local,
regional and national scales, directly and indirectly.
Brambles’ ambition is to pioneer regenerative
supply chains with reuse, resilience and
regeneration at its core. This ambition underpins
Brambles’ social licence to operate. Through the
power of its circular business model, network
advantage and expertise, Brambles transforms
key sources of capital into signicant value for
its stakeholders.
For customers, Brambles’ pooling solutions play an integral
role in ensuring the ecient ow of goods through their supply
chains and delivering operational, nancial and environmental
eciencies not available through single-use alternatives.
Brambles also leverages its unique position to generate positive
outcomes throughout its value chain. This includes enabling
customer collaboration, optimising transport networks and
addressing food security while promoting the circular economy
and sustainable forest certication.
The Value Brambles Creates
6 7Operating & Financial ReviewBrambles 2023 Annual Report
PALLETS AND RPCs
GROWERPRODUCER
CONTAINERS
MANUFACTURER RETAILERPALLETS
1
2
3
3
1
2
2
3
1
Share and reuse: How it works
Using its network advantage and
asset management expertise,
Brambles seamlessly connects supply
chain participants, ensuring the ecient
ow of goods through the supply chain.
By reducing transport distances and the number
of platforms required to service the supply chain,
Brambles delivers savings in which all participants
share. Brambles retains ownership of its equipment at
all times, inspecting, cleaning and repairing to maintain
appropriate quality levels and durability standards.
In addition, Brambles continues to enhance its
platforms including innovation in the materials used to
further improve its sustainability credentials.
Brambles generates sales revenue predominantly from
rental and other service fees that customers pay based
on their use of its platforms and services.
1
Brambles provides standardised pallets, crates
and containers to customers from its service centres
as and when the customer requires.
2
Customers use this equipment and Brambles’ support
services to transport goods through the supply chain.
3
Customers either arrange for the equipment’s return
to Brambles or transfer it to another participant for reuse.
Inherently Sustainable Operating Model
Brambles’ operating model follows the principles of the
circular economy. By promoting the ‘share and reuse’ of assets
among multiple parties in the supply chain, Brambles offers
customers a more ecient, cost-effective and sustainable
alternative to disposable single-use products or their own
proprietary platforms.
This inherently sustainable business model, which reduces
demand on natural resources, combined with Brambles’
sustainable sourcing strategy, which regenerates its resource
base, underpins Brambles’ position as a global leader
in sustainability. This has consistently been recognised
by ESG research and ratings providers around the world,
as outlined on page 2.
To view the Group’s
Sustainability Strategy, go to:
brambles.com/2025-sustainability-targets
Network Advantage and Supply Chain Expertise
Brambles’ sustainable operating model is underpinned by its:
• superior network advantage that comprises the scale and
density of its service centre network and the strength
of its customer relationships in every major market in
which it operates; and
• industry-leading supply chain expertise, developed
over 70 years of managing customers’ supply chains
around the world.
This means Brambles can be faster and more responsive
to its customers’ needs, and in times of uncertainty and
increased volatility, more resilient and more reliable.
Transformation to Strengthen
Competitive Advantage
Through the Shaping Our Future transformation programme,
Brambles is investing to build on its existing competitive
advantage by enhancing its circular model, generating greater
operational eciencies and increasing the value created
across its customers’ supply chains. Investments to build
the ‘Brambles of the Future’ include developing new business
capabilities and identifying new sources of growth that will
allow the business to stay at the forefront of innovation.
Brambles manages the world’s largest pool of reusable pallets, crates and
containers. Through its inherently sustainable operating model, superior network
advantage and industry expertise, Brambles leads the market in more ecient and
sustainable supply chains.
Operating Model
8 Brambles 2023 Annual Report 9Operating & Financial Review
Preserving manufactured capital
Enhancing intellectual capital
Conserving natural capital
Enhancing customer relationships
Shaping
Our Future
BUSINESS
EXCELLENCE
ASSET EFFICIENCY &
NETWORK PRODUCTIVITY
CUSTOMER
VALUE
DIGITAL
TRANSFORMATION
Delivering
increased
returns
and funding
investment
in innovation
Delivering
new business
capabilities
and sources
of growth
FY23 key initiatives
Digital Transformation
Harness the power of data and
digital insights to unlock new
sources of value for Brambles
and its customers
• Reimagining a digitally enabled pooling
model to transform the customer
experience and simplify Brambles
• Driving data analytics as a core
competency of Brambles
• Deploying asset digitisation and advanced
analytics to provide visibility into its asset
pools and networks
• Developing a business building capability
to create new customer solutions focused
on improving business performance
and sustainability
• Identifying and addressing causes
of ineciency in end-to-end
supply chains, driving value for
customers and for Brambles
• ~450,000 smart pallets with autonomous tracking devices now deployed in
over 30 countries. Combined with enhanced data analytics, these devices have
provided data and insights to deliver asset eciency benets and new commercial
opportunities by identifying uncompensated ows. Capability and infrastructure
established in these countries to rollout further smart asset diagnostics as the
business continues to test, learn and adapt its approach to deploying smart assets
• Progressed serialisation+ trial to individually identify pallets in Chile with
~1 million unique tags installed, enabling the business to trial and adapt its data
collection technologies and processes
• Scalable data infrastructure being developed to rapidly deploy advanced
analytics and machine learning solutions across the business including
improved predictive capabilities to optimise collections, detect and resolve
anomalies and proactively identify asset ineciencies for early resolution
• Continued to build digital capabilities across the organisation, upskilling existing
employees and onboarding specialist expertise across data science, data
engineering and product management
Customer Value
Make Brambles the natural
partner of choice for supply chain
customers, today and tomorrow
• Creating an effortless customer experience,
making it easy for customers to choose and
stay with Brambles
• Enhancing platform and service quality,
focused on what makes a difference
for customers and differentiating
vs competition
• Collaborating with customers to unlock new
sources of value and solve shared supply
chain problems
• Investing in customer systems, data
and insights to guide decisions
• Delivering increased customer value
powered by digitisation of our platforms
• Transactions on the myCHEP platform increased 11% including additional
collection and transfer activity, driven by improving self-service functionality
• Improvements to on-time pallet delivery performance against service level
agreements in the second half of the Year
• Improvements to transactional surveys to gauge customer satisfaction, faster
customer response and resolution times and increase in pallet quality based
on customer survey
• Achieved 80% dynamic pallet delivery notications (real-time tracking) target
in Latin America and US
• Developed several prototype customer solutions to remove supply chain
ineciencies, enabled by digital capabilities
Business Excellence
Reinvent the organisation,
technology and processes
to be simpler, more effective
and ecient
• Improving organisational eciency through
process simplication and automation
• Building the technical foundations to
support transformation, including updated
IT tools and cloud migration
• Attracting, retaining and empowering
high-calibre people
• Developing distinctive capabilities, notably
in digital services, advanced analytics and
automated supply chain
• 5,000 roles trained in data analytics across the organisation
• Reduced Brambles Injury Frequency Rate to 3.8 in FY23 representing a reduction
of 24% to the FY21 baseline
• 36% of managerial roles held by women and on track for at least 40% by FY25
• Recognition in the Bloomberg Gender Equality Index
which tracks the performance of companies committed to transparency in
gender-data reporting and advancing gender equality
• Top Employer status across four regions and 25 countries
Asset Eciency &
Network Productivity
Deploy new technologies and
ways of working to increase
productivity and sustainability
• Optimising collection engine, improving
asset control and reducing capital intensity
• Standardising processes and controls to
enhance the eciency and resilience of
the operations
• Continuing plant and network
automation journey
• Removing waste from end-to-end supply
chains by optimising networks with
customers and suppliers
• ~10 million pallets recovered and salvaged through pallet remanufacturing
processes and a range of asset productivity initiatives supported by data
analytics and the deployment of smart assets
• 15 automated repair processes implemented during the Year with a total
of 22 now installed and delivering benets across the network
• Roll-out of the durability programme across four pallet platforms resulting
in a 118bps reduction in damage rate compared with FY21 baseline
• Sharing and embedding of optimal practices across service centre network
to improve reliability, productivity and standardisation. 37 continuous
improvement events identied in FY23 to increase operational eciency
including improvement to repair equipment and settings as well as more
ecient processing of pallet orders to customers
Approach to Transformation
Brambles is taking a twin-track approach to transformation to unlock value for customers and shareholders: optimising the existing
business as well as building the ‘Brambles of the Future’. Progress of the specic Shaping Our Future programme initiatives and
measures of success can be found on pages 12 and 13.
The goal for optimising the existing business is to deliver increased returns and fund investment in innovation through higher
productivity, better ways of working and improved capabilities. The performance to date highlights the success of these initiatives as
the transformation programme shifts towards the next phase, building the ‘Brambles of the Future’. This aims to create new business
capabilities and identify new sources of growth to increase the resilience of Brambles’ business and the value it brings to fast-moving
supply chains around the world.
Shaping Our Future
Transformation
Building from strong foundations, Brambles is transforming
its business through its Shaping Our Future transformation
programme to meet its strategic ambition of reinventing pooling
solutions for the supply chains of tomorrow and further strengthen
its value proposition with stakeholders.
The Shaping Our Future transformation programme is making Brambles even better,
driving a step change in value creation. It is making Brambles better for its customers,
its employees, its shareholders and the societies in which it operates.
With over 1,300 employees involved in the transformation, Shaping Our Future
encompasses every aspect of Brambles’ business and seeks to transform the
performance of the current business model while investing to create the Brambles
that will continue to be an industry leader for many years to come.
Strengthening Global Leadership in Sustainability
The ambition of our transformation programme will set new benchmarks for circular
business models by preserving and enhancing our sources of value while creating
new value.
A world leader in ESG, Brambles is uniquely positioned to lead the transition to regenerative
supply chains. Its circular business model with reuse, resilience and regeneration at its core
aligns nancial, social and environmental value to the aspirations of Brambles’ stakeholders.
Brambles has a vision to pioneer the rst global regenerative supply chain, which is
supported by its ambitious sustainability targets for 2025 and a net-zero commitment by
2040. Further details on the sustainability initiatives can be found on pages 18 to 19.
1110
Brambles 2023 Annual Report Operating & Financial Review
Asset eciency
Reduce uncompensated pallet
losses by ~30% by end FY25
7
Reduce pallets scrapped by ~15%
by end FY25
Improve pallet pool utilisation:
reduce pooling capex / sales ratio
by at least 3pts through FY25
7
Context for metrics below target
‘Uncompensated pallet losses’
and ‘pallet pool utilisation’
metrics below target due to pallet
availability challenges in 1H23,
lumber ination impact on pooling
capex and ongoing ineciencies
across global supply chains which
have resulted in longer cycle
times and increased loss rates.
In response, Brambles’ asset
productivity initiatives resulted
in ~10 million pallets being
recovered and salvaged during
the Year. In addition to these
initiatives the business continued
to price to recover the increased
cost-to-serve and also increased
the level of asset compensations
for lost assets. Collectively, these
pricing and asset productivity
initiatives resulted in a 6pt
improvement in the pooling capex
to sales ratio to 23%. The business
expects to deliver its FY25 capex
to sales target of ~17% and FY25
uncompensated pallet loss target.
Network productivity
Reduce the pallet damage ratio by
75bps year-on-year through FY25
from pallet durability initiatives
7
Rollout fully automated end-to-end
repair process to 70 plants by end of
FY24 to drive throughput eciency
7
Organisation
25% reduction in BIFR by
end FY25 and developed
wellbeing-at-work programme
At least 40% of management roles
held by women by end FY25
Technology
Migration of priority applications
to the Cloud by end FY22
CRM transition to Salesforce
completed in FY22 as part of
ongoing CRM improvements
Context for network productivity
metrics below target
Durability programme has
delivered a cumulative 118bps
reduction in damage rates
against the FY21 baseline versus
the FY23 target of 150bps.
The reason for the shortfall
relates to increased wear of
pallets due to longer cycle times.
Ongoing durability initiatives
such as new pallet design and
other platform innovations as
well as improving cycle times
are expected to support further
damage rate reductions and meet
the FY25 objective.
Automated repair installations
across the network by the end of
FY25 revised from 70 to 50 sites
following a site-by-site return
assessment and reects capital
allocation discipline. Expected
returns from 20 sites not being
pursued will be achieved through
other eciency and supply
chain initiatives.
Environment
Carbon neutral Brambles operations
and 100% renewable electricity
continued indenitely (Scope 1 & 2)
100% sustainable sourcing of timber
continued indenitely
30% recycled or upcycled plastic
in new closed loop platforms
by end FY25
Social
Advocate, educate and impact
1,000,000 people to become
circular economy change makers
by end FY25
Governance
Create leading industry circularity
indices with strategic partners
by end FY25
Operationalise annual supplier
certication across all markets
by end FY22
Digital Transformation Customer value
Asset Efciency &
Network Productivity Business Excellence Sustainability & ESG
Enabler of
UnderlyingProfitgrowth
5
~55% of
UnderlyingProtgrowth
5
~45% of
UnderlyingProtgrowth
5
Enabler of
long-term value
Better for Brambles
Deploy asset productivity analytics
solutions across 20 markets by end
FY22 and 30 markets by end FY23
Deploy analytics solutions to
identify stray assets and predictive
analytics to recover assets across
5 markets by end FY23
Better for customers
Launch 2 commercial
optimisation and 2 proactive
Customer Experience digital
solutions by end FY23
Data capability and culture
First 4 priority domains
6
managed
through data hub by end FY22
Train 300 leaders in digital and
analytics skills by end FY22; 5,000
roles across company by end FY23
Smart assets
Deploy full smart asset solution
in 2 markets by end FY24
Key
Completed and no further
work required
Completed and on-going
Progressing and on-track
Tracking below target
Customer engagement
Increase customer NPS by
8-10pts by end FY25
7
Increase % of customer orders
placed through electronic channels
by 1-2pts p.a.
Revenue growth
1-2% net volume growth p.a.
with existing customers
7
1-2% net new wins p.a.
2-3% price/mix p.a. in line with
value-based pricing
Product quality
Reduce customer reported defects
per million pallets by 15% by end
FY25 compared with FY20 baseline
7
Customer collaborations
Double number of customer
collaborations on sustainability
from 250 to 500 by end FY25
Context for metrics below target
NPS and volume growth below
target, mainly due to pallet
availability challenges in 1H23,
softening consumer demand
and inventory optimisation at
retailers and manufacturers. Asset
productivity initiatives, destocking
and ongoing investment in
the pallet pool contributed to
improved pallet availability and
service levels across the network
in 2H23. NPS scores improved
in 2H23 in line with restored
service levels in most markets
and overall customer experience
enhancements including better
performance on product quality,
and on-time pallet deliveries.
5 Contribution to FY25 Underlying Prot growth uplift from FY21.
6 Asset movement, customer, pricing, and supply chain.
7 Impacted by market conditions.
Progress on Shaping Our Future
Metrics and
Measures
12 13Operating & Financial ReviewBrambles 2023 Annual Report
Dividend Policy and Payment
Brambles’ dividend policy is to target a payout ratio of 45-60% of
Underlying Prot after nance costs and tax, subject to Brambles’
cash requirements, with the dividend per share declared in
US cents and converted and paid in Australian cents.
This Year, the Board declared total dividends of 26.25 US cents
per share with the Australian dollar payment equivalent to
39.50 Australian cents per share, an increase of 22% on the
prior year. This results in a payout ratio for the Year of 55%, 2 pts
above the prior year’s payout ratio of 53%. FY22 total dividends
were 22.75 US cents per share or equivalent to 32.31 Australian
cents per share.
The nal dividend for 2023 of 14.00 US cents per share is a 14%
increase on the 2023 interim dividend of 12.25 US cents per share,
and will be 35% franked. This dividend is payable in Australian
dollars at 21.83 Australian cents per share.
This represents an increase of 27% compared with the 2022
nal dividend in Australian cents per share and reects
strong earnings growth. The 2023 nal dividend will be paid
on 12 October 2023 to shareholders on the Brambles register
at 5.00pm on 14 September 2023. The ex-dividend date is
13 September 2023.
Dividend Reinvestment Plan
The non-underwritten Dividend Reinvestment Plan (DRP) was
reinstated during FY23 and remains in place. Shares under
the DRP will not attract a discount and the dilutive impact
on earnings per share of the DRP will be neutralised.
Eligible shareholders wishing to participate in the DRP should
conrm their election status before 5pm Sydney time on
Friday 15 September 2023 with Brambles Limited’s Share
Registrar, Boardroom Pty Limited.
Brambles expects to deliver ROCI in the mid-to-high teens and
total value creation for shareholders of 10%+per annum with:
• EPS growth expected to be in the high single-digits driven by:
– Sales revenue growth in the mid single-digits based on a combination
of pricing and volume growth with new and existing customers;
– Underlying Profit growth in the high single-digits through operating
efficiencies and supported by further investment in the business; and
• Dividend yield expected to be between 2-3% and supported by
Free Cash Flow generated through the cycle after fully funding
growth andtransformationinvestments.
Revenue growth and leverage
Underlying Profit
growth in the high
single-digits
EPS growth in the
high single-digits
Dividend yield
2-3%
Free Cash Flow
generation
Sales revenue
growth in the mid
single-digits
Growth
Optimisation
Transformation
Total value
creation
10%+ pa
Circular
‘Share and Reuse’
Model
Investor Value Proposition
Brambles generates value through a circular ‘share and reuse’ model that leverages
its scale, density and expertise to achieve superior operational eciencies.
These eciencies in turn generate cash ow that can either
be returned to shareholders or reinvested in the business to fund
growth and to optimise and transform its operations to build
a more resilient business.
By providing customers with supply chain solutions in
approximately 60 countries, Brambles offers shareholders
exposure to invest in a low-carbon circular business model,
with geographically diversied earnings streams, primarily
from the defensive global consumer staples sector.
The supply chains served by Brambles also provide a broad
range of growth opportunities including:
• increasing penetration of core equipment pooling products
and services in existing markets;
• diversifying the range of products and services;
• exploring the digitisation of supply chains; and
• providing a resilient foundation during supply
chain uncertainties.
Through transformation, Brambles will further strengthen
its competitive advantage and the long-term sustainability
of its business by unlocking new avenues for growth and
signicant operational and asset eciencies that will deliver
strong nancial returns for shareholders.
Investor value propostion
expected nancial outcomes
1514 Brambles 2023 Annual Report Operating & Financial Review
System‑Wide Solutions
Brambles conducts in-depth studies of customers’ supply chains
to map the ow of goods, information and platforms to identify
the causes of network ineciencies and product damage.
By determining the optimal mix of platforms and processes for
customers’ individual supply chains, Brambles can mitigate
network ineciencies and ensure the safe and sustainable
transportation of goods through the supply chain.
Transportation Solutions
Brambles’ superior network scale provides a unique capability
to coordinate collaboration between multiple supply chain
participants to deliver transport eciencies. This includes
matching and eliminating empty transport lanes, sharing
transport and contracting transport for and from customers.
The FY23 results of Brambles’ Positive Collaboration
programmes are available on pages 18-19.
Retail Store Solutions
Brambles works closely with its customers to develop retail store
solution strategies and consumer-facing platforms that improve
the eciency of the shared supply chain by increasing sales
at lower costs to the supplier, retailer and consumer.
These merchandising and fullment solutions, which include
full size and fractional display pallets, trays and RPCs, effectively
improve safety, and reduce the time, labour and activity required
to move goods from the point of production to the point of sale.
Manufacturing, Warehouse
and Distribution Centre Solutions
Using its experience in managing platforms, optimising
automated facilities and packaging performance testing,
Brambles has developed solutions that improve the overall
performance and eciency of customers’ facilities.
These solutions include: customising customers’ platform
processes; optimising how customers congure, build and
protect product loads; and providing higher quality platforms
and engineering services to improve the performance
of automated facilities.
Sustainability Solutions
Brambles’ leadership in sustainable sourcing of materials and
strong governance controls reduce risk and provide customers
with condence in their supply chain partnership.
Brambles creates value for customers by providing a sustainable
alternative to single-use disposable packaging, saving customers
money and signicantly reducing the environmental impact
of their operations.
Brambles’ network resilience and its resource-ecient,
low-carbon solutions mean it has an important role in helping
customers manage through supply chain disruptions while
transitioning to a low-carbon economy.
Customer Value Proposition
Brambles’ pallets, crates and containers form
the invisible backbone of the global supply
chain. This gives Brambles key insights that
help customers meet evolving consumer
demands while minimising their environmental
impact, and improving the safety and eciency
of their supply chains.
With a comprehensive suite of supply chain
solutions, Brambles provides its customers
with operational, nancial and environmental
eciencies not otherwise available
through the use of disposable alternatives
or proprietary models.
Brambles’ Zero Waste World (ZWW) programme reinforces its
commitment to collaborate with customers and create smarter
and more sustainable supply chains – creating more value by
using less and regenerating more resources. Brambles currently
has over 350 companies participating in its ZWW programme.
Through ZWW, Brambles seeks to use its unique position
in the supply chain to help customers address three key
industry challenges:
Eliminating waste
By using its circular economy expertise to convert
customers to more sustainable ‘share and reuse’
solutions which save resources and reduce costs.
Eradicating empty transport miles
By using its network scale with density and expertise
to facilitate collaborative transport solutions, bringing
manufacturers and retailers together to reduce
the environmental impact of their operations and
save money.
Reducing inefciencies
By using its end-to-end supply chain solutions and digital
technology to enhance customers’ visibility of their supply
chains so they can make better decisions.
Supply Chain Solutions
Brambles is integral to its customers’ supply chains, working
closely with all participants including manufacturers, producers,
growers and retailers. With end-to-end involvement, Brambles
has clear insights into what impacts the safe, ecient, reliable
and sustainable operation of global supply chains. By leveraging
these insights and its unmatched expertise, Brambles
offers customers comprehensive solutions that improve the
performance of the supply chain. This includes Brambles stress
testing its network against climate-related severe weather
events to improve its understanding of network vulnerabilities,
improve planning and reduce disruption. This helps address
the challenges associated with the increasing complexity, rapid
evolution and, at times, uncertainty of modern supply chains.
Platform Solutions
Brambles offers customers the widest range of supply
chain platforms including: pallets (timber and plastic);
Reusable Plastic Crates (RPCs); bins; and specialised containers.
By eliminating the need for customers to purchase and manage
their own platforms, Brambles reduces the capital requirements
and complexity of customers’ operations while simultaneously
reducing waste throughout their supply chains. 100% of the wood
used for timber pallets is certied as sustainably sourced and in
FY23 Brambles sourced recycled material for 20% of its plastic
platforms. Brambles’ progress against its FY25 sustainability
target of zero product waste sent to landll is helping customers
meet their sustainable packaging goals.
16 17Operating & Financial ReviewBrambles 2023 Annual Report
Target UN SDG Alignment FY23 Progress Since FY22
Forest
Positive
• 100% sustainable sourcing of timber
• Transformation of more forestry
markets to Chain-of-Custody
(CoC) certication
• Enable the sustainable growth
of two trees for every tree used
SDG
15
SDG
8
SDG
13
Sustainably sourced timber 100% Achieved
CoC sourced timber 72.6%
1 pt improvement
Trees replanted through certied sustainable forestry programmes
8
3,383,951 Decrease
Enabled the sustainable growth of second tree
9
3.85m trees Increase
Climate
Positive
• SBTi veried climate targets for full
value chain aligned to a 1.5°C climate
• 100% renewable electricity and all
our operations will be carbon neutral
by 2025
SDG
13
SDG
7
Carbon neutrality for operations (Scope 1 and 2 emission sources) Achieved
Electricity from renewable sources
10
100% Achieved
Performance against SBT
(includes Scope 1, 2 and 3 emissions FY23 vs FY22)
11
1,439 ktCO
2
-e 5.2% improvement
Waste
Positive
• Zero product materials sent
to landlls for all Brambles and
subcontracted locations
• 30% recycled or upcycled plastic
waste in plastic products
SDG
12
SDG
6
Number of Brambles new and next generation platforms
containing recycled content
12
13 44.4% increase
Brambles’ total recycled plastic material purchased
13
20.2% 3 pts improvement
Percentage of plants diverting product waste from landll:
• Brambles managed plants 94.2%
20 pts improvement
• Third-party plants 71.7%
17 pts improvement
• All plants 74.4%
16 pts improvement
Target UN SDG Alignment FY23 Progress Since FY22
Supply Chain
Positive
• Increase environmental benets
in our customers’ supply chains
through circular model
SDG
12
SDG
13
SDG
9
Increased our positive environmental impact across our
customers’ supply chains
14
1.9m tonnes of CO
2
-e
3.0% decrease
4,276 megalitres of water 2.4% decrease
3.1m cubic metres of wood 1.9% decrease
3.0m trees 1.9% decrease
1.2m tonnes of waste 2.9% decrease
Ellen MacArthur Foundation (EMF) Circulytics score A
Achieved
Positive
Collaboration
• Double the number of customer
collaborations through our ZWW
from 250 to 500
SDG
12
SDG
13
SDG
9
SDG
17
Customers in collaboration
15
358 3.2% decrease
Collaborative initiatives 1,762
18.4% increase
CO
2
-e saved
16
92,375 tonnes 12.8% decrease
Workplace
Positive
• 25% reduction in BIFR
• At least 40% women
in management roles
SDG
3
SDG
5
SDG
10
SDG
16
BIFR performance 3.8 7.3% improvement
Top Employer accreditation Achieved in 25 countries
Achieved
Women on the Board 45.5%
5 pts improvement
Women in management roles 36.3%
3 pts improvement
Target UN SDG Alignment FY23 Progress Since FY22
Food
Positive
• Collaborate with food banks to serve
rescued food to at least 10 million
people per year
SDG
2
People receiving meals through Brambles’ support
for food rescue organisations
19,716,653 globally Achieved
Circular Economy
Transformation
• Advocate, educate and impact one
million people to become circular
economy change makers
SDG
4
SDG
12
People reached through our communications, training and advocacy
903,500
(Cumulative result since FY21)
Improvement
Positive Impacts
for People and
OurPlanet
• Adopt leading natural and social
capital accounting approaches
Brambles has trialled and applied a draft carbon accounting approach developed by the GHG Protocol to
understand the biogenic
17
carbon that ows through our full value chain. More information will be provided in
Brambles’ Sustainability Review due for release in September 2023.
Brambles will pioneer
regenerative supply chains
by improving our circular
model every year, increasing
the environmental benets in
our customers’ supply chains.
Build a safe, inclusive and
respectful workplace.
Business
Positive
Brambles’ roadmap to regeneration is driven by progress against the ambitious 2025 sustainability targets. Brambles’ performance
against the targets is provided here. Further information will be available upon the release of Brambles’ Sustainability Review in
September 2023.
Data covered by KPMG assurance.
Our commitment is
to be Planet Positive by
restoring forests, going
beyond zero waste and
drawing down more carbon
than we produce, ultimately
becoming a regenerative,
nature positive business.
Planet
Positive
Brambles’ 2025 Sustainability Targets
8 This metric is directly connected to certied sourcing volumes each year. In FY23 reduced capital expenditure
on new pallets compared to FY22 reduced the number of trees used and replanted.
9 In FY21, Brambles acquired 10 timber farms in South Africa, totalling 3,950 hectares and 3.85 million trees.
Introducing new sustainable practices and a certication process, Brambles will ensure the ongoing regeneration
of trees. More detail on the calculation methodology will be available in the 2023 Sustainability Review.
10 Brambles’ renewable electricity results include electricity from renewable contracts 39%, on-site generation 3%
and Energy Attribute Certicates (EACs) 58%.
11 See Brambles GHG emissions performance on page 22.
12 This datapoint is not assured.
13 Brambles purchase of recycled material has increased as new product innovations have been launched in FY23.
14 Environmental benet metrics are directly linked to volume of products issued compared to previous period. Lower product issue volumes in FY23 compared to FY22 have
resulted in lower environmental benet estimations. FY22 environmental benets have been restated to reect an updated LCA for Australia. Further details will be available
in the Brambles Sustainability Review 2023 – Supplementary Information.
15 Fewer customers in collaboration resulted from reduced transport orchestration between customers, and more focus on asset availability discussions.
16 Total kilometres saved increased by 5%. Reduced CO
2
-e savings are due to improved logistics emissions factors since FY22.
17 Biogenic carbon refers to carbon that is sequestered from the atmosphere during biomass growth and may be released back to the atmosphere later due to combustion of
the biomass or decomposition.
Performance above FY22.
Performance below FY22.
Brambles’ Communities
Positive programme will
build resilience, promote
circularity and account for the
connections between society,
the economy and nature.
Communities
Positive
1918 Brambles 2023 Annual Report Operating & Financial Review
Three climate themes TCFD Identied
in 2020 TCFD analysis
Brambles is at the forefront of the low-carbon transition, demonstrating how a regenerative vision
can result in tangible business benets. Its share and reuse business model minimises Brambles’
environmental impact and helps customers decarbonise their supply chain. Moreover, Brambles’
transformation programme is enhancing the capabilities of circular business models and is redening
expectations for a sustainable future.
This is Brambles’ fourth climate-related disclosure,
communicating its efforts to address climate change
through its innovative circular business model. It includes a
summary of its progress against the recommendations of the
Task Force on Climate-related Financial Disclosures (TCFD)
and a standalone report will be available in September 2023 for
those seeking more detailed information on Brambles’ efforts
to mitigate climate change and adapt to potential risks and
opportunities. Further context on how Brambles leverages its
circular model to address climate change is available in previous
TCFD disclosures which are available on Brambles’ website.
Climate Governance
Brambles’ Board of Directors, directly and through authority
delegated to the Audit and Risk Committee (ARC), oversees the
Executive Leadership Team’s (ELT) strategy delivery, developed
to mitigate and adapt to the increasing risks and opportunities
associated with climate change. Brambles’ circular business
model has enabled the rapid integration of climate change risks
and opportunities into its processes. In FY23, the ELT sought
to increase decarbonisation efforts and test key parts of the
network and timber sourcing supply chain for resilience against
potential climate risks.
The Board is informed about upcoming International Sustainability
Standards Board sustainability and climate-related disclosure
changes and has been briefed on progress in climate risk
assessments and decarbonisation.
Integrated Risk Management
Brambles has a dedicated ARC that reports to the Board.
The Chief Executive Ocer oversees the strategic response to
climate change, while the day-to-day management falls under
the Chief Operations Ocer (COO) and the Chief Financial Ocer
(CFO). The COO is responsible for the decarbonisation portfolio
and the operational implementation of risk and opportunity
management, while the CFO has oversight of the sustainability
function. The Sustainability Risk and Compliance Management
Committee carries out sustainability risk assessments and
reviews risk management initiatives which are incorporated
into the risk reviews presented to the ARC and Board. In FY22,
Brambles established a Global Decarbonisation Governance
Framework encompassing Climate Positive and Waste Positive
targets, which has delivered solid progress in FY23 with further
details available on pages 18 to 19.
COCO
22
1
2
3
Low‑Carbon Advantage
(Opportunity assessment)
Network Resilience
19
(Risk and opportunity assessment)
Raw Material Supply
20
(Risk assessment)
Climate Strategy and FY23 Progress
Brambles has set a pathway to net-zero greenhouse gas
(GHG) emissions by 2040, and its 2020 commitment to a 1.5°C
climate future was an essential driving force behind its ve-year
sustainability targets. Brambles delivered on its carbon-neutral
operations target four years early and reached 100% renewable
electricity in its own operation in FY23
18
.
Brambles’ progress against its Climate Positive commitments
focuses on three main areas: decarbonisation; network resilience;
and timber sourcing risk analysis. All our decarbonisation efforts
enhance Brambles’ Low-Carbon Advantage and this Year deeper
engagement with suppliers in our most emissions-intensive
activities has uncovered further opportunities to cooperate on
shared objectives. For network resilience, investigations included
stress testing our material networks against potential severe
weather hazards. For raw material supply and security, a project
assessed forestry-specic climate scenario analyses.
The results have helped progress our Low-Carbon Advantage,
supported our resilience programmes and increased our
knowledge of the risks and mitigations in our network and
raw material supply chains.
18 See Brambles GHG emissions performance on page 22.
19 Network resilience – Physical climate risk and hazard assessment by stress testing service centres and networks.
20 Raw material supply – Forestry-related sourcing climate risk analysis over short, medium and long-term timeframes.
21 The sustainability certicates quantify environmental advantages of Brambles’ circular business model for customers by calculating the carbon emissions, waste and
material savings over typical single-use or one-way alternatives. The savings shown in the sustainability certicates are independently veried to ISO 14040 LCA standard.
Low‑Carbon Advantage
In FY23, Brambles continued to
consolidate its sustainability leadership
and advance its decarbonisation strategy.
This includes Shaping Our Future
transformation programme initiatives and
supply chain engagement on Scope 3
emission sources such as transport
carriers and outsourced service centres.
Brambles’ decarbonisation teams have
utilised their regional decarbonisation
roadmaps to deliver progress. In FY23
this includes electrifying forklift trucks,
prioritising more onsite solar projects,
and creating sustainability guidelines for
decision-making processes. Brambles
has integrated decarbonisation targets
into key leaders’ personal objectives
and is engaging with the business to
integrate sustainability criteria into
procurement processes. Sustainability
certicates
21
continue to showcase
the benets of using circular reusable
pallets for customers. Brambles’ product
development teams are committed to
regenerative innovation by initiating the
product design process with recycled and
upcycled materials.
Brambles’ Network Resilience
In FY23, Brambles initiated an assessment
to stress test its network against a range
of severe weather scenarios, covering the
most operationally material networks.
This work assessed the operational and
nancial impacts of ooding and bushre
events of differing severity on its assets,
operations, products and workforce.
The impacts from these simulated stress
tests ranged from insignicant to major
and are inuenced by factors such
as duration, location and site-specic
conditions. Brambles will use the ndings
to inform a more integrated approach to
network resilience, including tailoring of
plans to the vulnerabilities of individual
sites and geographic areas. To prepare for
potential disruptions from climate-related
severe weather, Brambles will continue
conducting stress tests during FY24
across key regions and incorporate
mitigations into its Business Continuity
Management plans.
Materials Sourcing
Supply and Security
Brambles created the Timber Supply
Climate Risk Tool to assess climate risks
in key geographic areas related to its
timber-sourcing supply chains. The tool
currently covers locations in Brazil and
Mexico, approximately 25% of timber
volumes, and will expand to other areas in
FY24. The tool will assist climate-related
discussions with suppliers, assess
regionally specic sourcing risks, and
provide a combined portfolio-wide view
by FY24. Importantly, the tool will help
identify areas with lower climate risk
to enhance overall sourcing continuity
for certied wood and improve our
understanding of each region’s resilience
to climate impacts. Based on the tool’s
ndings, Brambles will incorporate
relevant improvements into its due
diligence processes.
COCO
22
Brambles’ Climate Change Strategy
Brambles’ Climate Governance
Global Head of
Decarbonisation
Chief Executive Officer
Chief Financial Officer
Chief Sustainability
Officer
Group Head
of Risk
Board
Frequency of meetings: Biannually
Audit and Risk Committee
of the Board
Frequency of meetings: Biannually
Sustainability Risk and
Compliance Management
Committee
Frequency of meetings: Biannually
Chief Operations Officer
• Overall responsibility for Brambles' strategic response to
climate change including approval of the overall strategy,
policies and disclosures
• Sets climate-related targets
• Monitors performance against the targets
• Executive leaders and
functional specialists
• Sustainability risk assessments and
reviews risk management initiatives,
incorporated into the risk reviews
presented to the ARC and Board
Responsibility for implementing and managing Brambles’ risk management
framework including its strategic response to climate change
• Consideration of current and scenario climate-related risks
and opportunities
• Monitors risks and opportunities including business resilience
• Monitors controls and control effectiveness
Management
20 21Operating & Financial ReviewBrambles 2023 Annual Report
Financial Position and
Financial Risk Management
Capital Structure
Brambles manages its capital structure to maintain a solid
investment grade credit rating. During FY23, Brambles held
investment grade credit ratings of BBB+ (stable outlook)
from Standard & Poor’s and Baa1 (stable outlook) from
Moody’s Investors Service.
In determining its capital structure, Brambles considers
the robustness of future cash ows, the potential funding
requirements of its existing business, growth opportunities
and acquisitions, the cost of capital, and ease of access
to funding sources.
Potential initiatives available to Brambles to achieve its desired
capital structure include: adjusting the amount of dividends
paid to shareholders; returning capital to shareholders; buying
back share capital; issuing new shares; selling assets to reduce
debt; varying the maturity prole of borrowings; and managing
discretionary expenses.
Treasury Policies
Key treasury activities include: liquidity management; interest
rate and foreign exchange risk management; and securing access
to short and long-term sources of debt nance at competitive
rates. These activities are conducted on a centralised basis in
accordance with Board policies and guidelines, through standard
operating procedures and delegated authorities.
These policies provide the framework for the treasury function
to arrange and implement lines of credit from nanciers, select
and deal in approved nancial derivatives for hedging purposes,
and generally execute Brambles’ nancing strategy.
Brambles manages foreign exchange risk by raising debt in
currencies where there are matching assets and by using forward
foreign exchange contracts to hedge exposure for material
commercial transactions and cross-border intercompany loans.
Brambles’ exposure to interest rate volatility is mitigated by
maintaining a mix of xed and oating-rate instruments, including
the use of interest rate derivatives, within select target bands over
dened periods.
The Group uses standard nancial derivatives to manage
nancial exposures in the normal course of business. It does
not use derivatives for speculative purposes and only transacts
derivatives with relationship banks. Individual credit limits are
assigned to those relationship banks, thereby limiting exposure
to credit-related losses in the event of non-performance
by any counterparty.
Funding and Liquidity
Brambles operates within the framework of its liquidity and
funding risk policy to ensure the Group maintains sucient
funds to meet its nancial obligations in a timely manner.
This is achieved through limiting the concentration of maturity of
committed credit facilities, ensuring diversity of funding sources
and maintaining a minimum liquidity buffer as a contingency
against any unforeseen changes in cash requirements. The policy
also ensures sucient funding is available for any planned
investment opportunities, capital management activity, and
pre-funding of committed debt repayments, including bond
and lease maturities, within the next 12 months.
Brambles generally sources borrowings from relationship banks,
with current investment grade ratings ranging from single A
to AA, and debt capital market investors across a range of
maturities and currencies. As at 30 June 2023, committed bank
facilities totalled US$1.8 billion with maturities ranging to 2027.
Borrowings under the facilities are oating-rate, unsecured
obligations with covenants and undertakings typical for these
types of arrangements. Borrowings from debt capital markets
are through the issue of unsecured xed interest notes, with
interest paid either annually or semi-annually. At 30 June 2023,
loan notes on issue totalled US$2.1 billion with maturities
out to March 2031.
In August 2022, the Group entered into a new US$1.35 billion
5-year sustainability-linked syndicated revolving credit facility
(RCF) agreement to renance approximately US$1 billion of
bilateral bank facilities which were cancelled. The facility
provided US$350 million of increased liquidity and extended
the Group’s debt maturity prole. The RCF pricing is linked to
performance against elements of the Group’s 2025 sustainability
targets including decarbonisation, which remain on track.
The RCF has two one-year extension options which may extend
the maturity of the facility to 2029, subject to banks’ consent.
The rst option was exercised and approved in July 2023
extending the maturity to August 2028.
In December 2022, Brambles established a €2.5 billion
Euro Medium Term Note (EMTN) shelf programme to
facilitate future bond issuance in debt capital markets.
The programme is listed on Singapore Exchange Securities
Trading Limited.
In March 2023, Brambles issued a €500 million green bond
under the recently established EMTN shelf programme and
Green Finance Framework in support of its circular economy
business model. The bond has a term of eight years with
an interest rate of 4.25%. The proceeds have been allocated
against Brambles’ portfolio of eligible green assets including
pallets, crates and containers used within its share and reuse
business model.
As at 30 June 2023, Brambles held US$0.2 billion in cash and
cash equivalents.
Integrating Climate Change Considerations
in Financial Processes
Brambles is taking action to adapt to the evolving nancial and
sustainability reporting landscape by incorporating climate and
sustainability considerations deeper into its nance function.
This involves enhancing its data and accounting systems to
measure GHG emissions and performance across its supply
chain. These developments supported the creation of a new role,
Global ESG Finance Lead, tasked with integrating and streamlining
our data and reporting processes, while preparing the business for
upcoming reporting and disclosure changes. Brambles is working
towards integrating climate and sustainability factors into its
strategic and nancial decision-making processes to align with its
Science-based Targets and net-zero commitment. This involves
initiatives across multiple teams, such as Financial Planning and
Analysis, Treasury, Group Financial Control, Asset Productivity
and Investor Relations.
To full its decarbonisation commitments and improve
business performance and resilience, Brambles is using the
Shaping Our Future transformation programme as a strategic
vehicle. In FY23, a cross-functional task force conducted
diagnostics and is now focusing on developing appropriate
mechanisms to align capital allocation with sustainability
targets and incorporate this during FY24. The Global Head of
Decarbonisation is supporting regional teams in estimating the
emissions impact of their initiatives to inform business decisions.
Brambles has a focus on decarbonisation activities that reduce
its carbon emissions and also have the potential to drive
eciencies across supply chains.
GHG emissions decreased across all sources in FY23, with
a 5.2% decrease compared to FY22. This was driven by the
operating environment as well as the planning and delivery of the
comprehensive decarbonisation strategy, which is aligned with
projections against the validated SBT. This reduction equates to a
7.7% decrease on Brambles’ 2020 baseline.
Increased uptake of renewable electricity and increased
diversion of product waste from landll in both CHEP and
outsourced locations demonstrate delivery against Climate
Positive targets. Contributing to the reductions were the
operating environment which led to lower product issue volumes
and some progressive inventory optimisation, as well as asset
productivity initiatives to reduce capital expenditure on new
pallets (accruals basis) and repair timber.
This activity also led to a decrease in emissions related to
upstream transport for our raw materials supply chains.
While there was a slight decrease in emissions from
downstream transport due to lower product volumes, extreme
weather-related disruptions in multimodal lanes in Australia
increased its road transport activity. Additionally, product volume
growth in LATAM and IMETA regions increased transport needs
in regions where multimodal solutions and alternative fuels are
less readily available to offset volume growth. Despite these
challenges, our US business was able to reduce its absolute
transport emissions at a regional level through increased
multimodal activity, while Europe achieved a total reduction
of over 4% in its transport emissions through optimisation
initiatives and growth in multimodal lanes.
Brambles’ Climate Change Strategy continued
Science-based Targets performance: Scope 1, 2 and 3 GHG emissions
22
Scope 1 & 2
CHEP electricity
Scope 3
Waste
Outsourced service centres
Capital goods (product materials)
Logistics
23
2030 target:
42% reduction
CHEP fleet fuel
33
CHEP site fuel
-100%
32.7%
7.1%
-24.4%
-6.7%
5.9%
-11.3%
Total emissions -7.7%
-100%
1.5%
-5.8%
-15.9%
-6.4%
-8.9%
-2.5%
-5.2%
1,439
2030 targets
verified by SBTi
(on FY20 levels)
21
11
0
139
376
859
FY23 FY22
23
11
4
Total Scope 1 & 2 -25.2%-13.1%
32 38
39
149
412
880
Total Scope 3 -7.2%-5.0%
1,407 1,480
1,518
Emission by source
(ktCO
2
-e)
Change
FY23 vs
FY20
baseline
Change
FY23 vs
FY22
2030 target:
17% reduction
24
22 Scope 1, 2 and 3 emissions have been restated for FY20, FY21 and FY22 to reect revised assumptions and improved data quality. Restated Scope 1, 2 and 3 emission
totals are: FY20 1,559 tCO
2
-e (1% increase), FY21 1,521 tCO
2
-e (1% increase) and FY22 1,518 tCO
2
-e (3% increase).
23 Includes both upstream and downstream transport.
24 The total emission reduction since FY20 of 7.7% is a weighted average of savings across Scope 1, 2 and 3, noting materiality of Scope 3 on the overall total.
2322 Brambles 2023 Annual Report Operating & Financial Review
Key Performance Drivers and Metrics
(Continuing operations)
Brambles monitors its performance and value creation through a number of nancial and
non-nancial metrics.
Net Debt and Key Ratios
US$m Jun‑23 Jun‑22
25
Change
Current borrowings 562.1 53.7 508.4
Current lease liabilities 110.2 140.0 (29.8)
Non-current borrowings 1,592.8 2,108.4 (515.6)
Non-current lease liabilities 619.2 573.4 45.8
Gross debt 2,884.3 2,875.5 8.8
Less: cash and cash equivalents (160.7) (158.2) (2.5)
Net debt 2,723.6 2,717.3 6.3
Key ratios
26
FY23 FY22
Net debt to EBITDA 1.31x 1.47x
EBITDA interest cover 18.2x 21.0x
Fixed rate debt
27
91% 64%
Brambles’ nancial policy is to target a net debt to EBITDA
ratio of less than 2.0x. As at 30 June 2023, the ratio was
1.31x and remains well within the nancial covenant included
in Brambles’ major bank facilities.
Interest cover of 18.2x is 2.8x lower than FY22. Despite
EBITDA growth, interest costs have increased reecting higher
interest rates on variable-rate debt and higher average borrowings
largely due to the impact of the completion of the share buy-back
programme in FY22 and the phasing of cash ow generation
weighted to the second half of FY23.
25 As reported.
26 Brambles denes EBITDA as Underlying Prot after adding back depreciation, amortisation and IPEP expense.
27 Fixed rate borrowings as a percentage of total interest-bearing debt excluding leases and overdrafts. On a forward basis, the effective ratio of the Group’s xed rate
borrowings is 74% adjusting for the renancing of the €500 million EMTN maturing in June 2024.
Maturity Prole of Committed Borrowing Facilities and
Outstanding Bonds (% of total committed credit facilities)
2.0
1.
0
0
.5
0
1.
5
US$b
< 1 yr 1-2 yrs 2-3 yrs 3-4 yrs 4-5 yrs > 5 yrs
18%
14%
47%
17%
4%
0%
Bonds Total bank facilities
Green bond Syndicated RCF
RCF included in > 5 years category as bank facility extended to August 2028 in
July 2023.
As at 30 June 2023, Brambles’ total committed credit facilities
were US$3.9 billion.
The average term to maturity of Brambles’ committed credit
facilities as at 30 June 2023 was 3.7 years (2022: 3.2 years).
On a proforma basis, including the RCF extension to August 2028
effective from July 2023, the average term to maturity
of committed credit facilities is 4.0 years.
In addition to these facilities, Brambles has entered into leases
for oce and operational locations and certain plant and
equipment to achieve exibility in the use of its assets. As at
30 June 2023, Brambles’ total lease liabilities were US$0.7 billion.
The rental periods vary according to business requirements.
Financial Position and Financial Risk Management continued
Sales Revenue
• Like-for-like volume growth in line with economic/
industry trends
• Expansion with net new wins and growth with
existing customers
• Pricing (including indexation) to recover cost-to-serve
increases and changes in mix (product/customer/region)
Cash Flow from Operations
• Protability
• Capital expenditure including the impact of lumber
ination on pallet purchases
• Asset compensations
• Movements in working capital and other provisions
Underlying Prot
• Transport, logistics and asset management costs (including
external factors such as third-party logistics and fuel prices)
• Plant operating costs in relation to management of
service centre networks and the inspection, cleaning
and repair of assets (including the cost and associated
inationary impacts on labour costs and raw material
costs, predominantly lumber)
• Cycle time and damage rate impacts on direct costs
• Income from asset and site compensations
• Contribution from returns on investments in automation
and supply chain initiatives
• Surcharge income related to lumber, fuel, and transport
cost ination
• Other operational expenses (primarily overheads, such
as selling, general and administrative expenses)
• Depreciation as well as provisioning for irrecoverable
pooling equipment
• Investments in the Shaping Our Future transformation
programme and associated benets
Return on Capital Invested (ROCI)
• Underlying Prot performance
• Capital expenditure on pooling equipment
• Brambles’ main capital cost exposures are raw
materials, primarily lumber, with ination impacting
pallet prices in recent years
• Asset control factors, i.e. the amount of pooling
equipment not recoverable or repairable each year
(and therefore requiring replacement), as well as
damage rate impacting repair costs
• Asset velocity or frequency with which customers
return or exchange pooling equipment
• Investment in business transformation initiatives –
both operating cost and capital investment
Safety
Brambles’ Zero Harm Charter states that everyone has the
right to be safe at work and to return home as healthy as
they started the day.
Brambles measures its safety performance through the BIFR,
which consists of work-related incidents resulting in fatalities,
lost time, modied duty or medical treatment per million
hours worked.
In FY23, Brambles accomplished an 8% year-on-year
improvement and successfully achieved a 3.8 BIFR target.
The Safety First strategy, introduced in FY22 and integrated
through FY23, empowers Brambles by aligning organisational
objectives with new leading indicators that serve as the
foundation for next phase of the strategy. These new
and varied approaches are designed to enhance safety
performance and further strengthen our Safety First culture,
bringing us closer to achieving Zero Harm.
Material Sourcing
Brambles is continuing its efforts to strengthen the
collaboration between its regions and external stakeholders,
to ensure the highest performance on timber sustainability.
Through supporting suppliers across the regions, Brambles
maintained 100% certied sustainable sourcing for all
timber materials while slightly improving the quantity of
Chain-of-Custody certied materials to 73%.
Brambles continues to leverage its position as a global
customer, providing its partners secure business opportunities
and a commitment to support their efforts and investments
on maintaining sustainable business practices.
2524
Brambles 2023 Annual Report Operating & Financial Review
Risk Implication Mitigating Actions
Maintaining
thequality of
pooling equipment
in line with
customer needs
A failure to maintain adequate quality
standards may result in reduced customer
satisfaction, additional costs and affect
the Group’s nancial performance
• Strict adherence to equipment quality standards, including
continuous monitoring of critical-to-quality metrics to assess
and ensure quality of products issued to customers
• Customer engagement to understand current and future needs,
and acting on feedback to improve quality performance
• Continuous monitoring of customer and market trends to
evaluate relevant quality investments, supported by ongoing
inspection and quality assurance processes
• Continued investment in plant automation, platform design
and material sciences
Maintaining control
of pooling
equipment
Pooling equipment losses, cycle times or
damage rates which exceed Brambles’
commercially acceptable range may cause
adverse impacts to its business model
and on its ability to deliver its customer
value proposition, resulting in lower than
expected nancial returns and cashows,
and constraining its ability to operate a
sustainable business model that delivers
value to its customers and Brambles
stakeholders. The increased raw materials
associated with additional replacement
assets could negatively impact Brambles’
decarbonisation targets
• Dedicated Group-wide function and asset control teams
across all business units, enabled by comprehensive
processes to increase the timely collection of assets
• Leveraging existing best practices, including the use of data
analytics to improve asset control and reduce losses across
the Group
• Developing improved processes and controls using advanced
data analytics and digital solutions, supported by deployment
of targeted digital tracking devices to improve communication
with key stakeholders to reduce losses and create more
ecient and sustainable supply chains
• Shaping Our Future transformation programme includes
development and testing of data and digital solutions to assist
in the control of its pooling equipment
• Regular schedule of customer equipment inventory audits
to assess key asset recovery metrics and identify potential
control issues
• In response to various disruption events (including war in
Eastern Europe, natural events, and global supply chain
challenges) and consequent demand volatility, Brambles
continues to invest in additional eld collection activities to
reduce cycle times and control losses
• Engagement and inuencing with customers and retailers
to improve pallet returns and reduce unauthorised reuse
by emphasising the sustainability impact of Brambles’
circular business model and its contribution to customer
sustainability objectives
• Pricing mechanisms to reect asset losses in higher risk
lanes/ows and compensation programmes to recover the
cost of asset losses and to change behaviour, while protecting
the business from economic harm
• Promoting legal and regulatory changes to assist Brambles in
enforcing its legal title to its pooling equipment and to control
misuse and black market activity
Risk Implication Mitigating Actions
Strategic, Operational, Compliance and Financial Risks
Geopolitical and
macroeconomic
conditions
including volatile
inflation, low
economic growth
environment, and
global supply chain
disruptions, as well
as the continuing
economic
uncertainty arising
from ongoing
geopolitical
conflicts and
tensions in trade
relations
Geopolitical and macroeconomic
conditions such as the war in Eastern
Europe, ongoing tensions between
China and the United States, the
ongoing volatility in the inationary
environment, and the prevailing low
economic growth could impact the
supply chains or industries in which
Brambles’ customers operate, and may
consequently affect demand for Brambles’
services, its nancial performance and/
or the operation of its business models.
In parallel, potential for geopolitically
motivated trade barriers and sanctions
may affect the operations of its customers
or demand for their products through
shifting consumer behaviours, which
in turn, could affect the demand for
Brambles’ services. Future geopolitical
events may also impact Brambles’ ability
to source cost-effective supplies of
sustainable timber (see Timber Risk)
• Monitoring of geopolitical and macroeconomic trends
• Strategic planning, including scenario planning, identifying
actions to mitigate risks related to continuity of supply to
customers and pallet availability
• Continued focus on driving investment in improved asset
eciency and expanding the customer value proposition,
targeted diversication in opportunities with attractive
long-term characteristics, such as strategic partnerships
with sawmills (see Timber Risk), and the expansion of plant
automation projects across the Group
• Adoption of changes to business models and pricing to
recover increased cost-to-serve and incentivise reduced cycle
times, with enhanced focus on cash generation. For example,
contracted surcharge mechanisms and exceptional price
increases are used to recover inationary cost increases or
irresponsible asset use
• In addition to the actions taken to improve Brambles’ access
to cost-effective supplies of sustainable timber (see Timber
Risk), local pallet collection activity has been increased to
reduce potential pallet losses and repair protocols enhanced
to reduce the number of scrapped pallets. Transportation
procurement teams manage the relationships and contractual
arrangements with transporters to mitigate transportation
supply risks
• The protocols and measures established in response to the
war in Eastern Europe, and the lessons learned, remain in place
to enable Brambles to operate and respond to the changes
and uncertainties in the economic and business environment.
Details of specic further actions are described in various
places in this table
• Developments in sustainability legislation across the markets
in which Brambles operates provide support for its business
model. In addition, as a sustainable business (see Climate
Change Risk), Brambles continues to work with governments
and regulators to encourage sustainable business models
and reduce waste in supply chains
Industry trends
inthe retail,
grocery, and
consumer goods
supply chains
Industry trends (e.g., fragmentation of
the retail supply chain, rapid acceleration
of e-commerce and growth in hard
discounters, increased automation in
supply chains, demand for different
pooling equipment materials or designs)
could affect demand for Brambles’ current
service offerings, the value of its existing
assets, and/or its nancial performance
Ongoing programmes to:
• Drive customer advocacy throughout the supply chain and
uncover opportunities to leverage the Group’s unique global
scale and value proposition;
• Create new products and service lines to meet customers’
requirements; and
• Drive innovation to identify and respond to emerging trends
in platforms, materials sciences, new technologies and
sustainability practices
Material Risks
Brambles is exposed to a range of strategic, operational, compliance and nancial risks, as well
as environmental and social risks, associated with operating in ~60 countries.
Brambles’ risk management framework incorporates effective risk management into its strategic planning processes and
requires a combination of business operating plans, processes, and other risk mitigation activities to effectively manage
key risks. The key risks (including environmental and social risks) to Brambles’ ability to achieve its strategic, nancial and
sustainability objectives (in no order of signicance), and respective mitigating actions, including its response to changes
in the geopolitical and macroeconomic environments and overall global supply chain challenges, are:
2726
Brambles 2023 Annual Report Operating & Financial Review
Risk Implication Mitigating Actions
Technology
security
(including
cybersecurity)
The Group’s security and monitoring of
information and operational technologies
and key operational and sensitive
business, customer and employee data
assets may be insucient and allow
motivated outside attackers or insiders
to gain unauthorised access which may
lead to non-availability of systems and/
or loss of integrity of data. This in turn
could result in the inability of the Group to
conduct its business effectively or at all
resulting in nancial loss and/or adverse
operational, employee safety, customer
trust and/or reputational consequences
• The ongoing security programme is delivering key capabilities
to protect systems and to detect and promptly respond to
unauthorised or inappropriate activity including ransomware
attacks. Key controls include, but are not limited to, email and
internet ltering, anti-virus software and security patching,
multi-factor authentication, enterprise security architecture
covering both oces and plants, 24/7 security operations
centre, mandatory security awareness training, as well as the
use of penetration testing across Brambles’ network
• Cyber incident response playbooks and table-top exercises are
conducted to test and improve Brambles’ readiness to respond
and recover in the event of a cyber security incident
• Brambles continues to use the National Institute of Standards
and Technologies Cyber Security Framework and the Australian
Cyber Security Centre’s Essential Eight advice to independently
assess, monitor, track, and report progress to Brambles’ Board
• Whilst these actions are enhancing Brambles’ management
of this risk, there are ongoing risk mitigation steps being
developed and implemented to assist in reducing the likelihood
of this risk arising
Data governance
Brambles relies on its IT, digital and
analytics systems and technologies,
and the data stored on those systems
and technologies to operate its business
and achieve its strategic objectives.
The improper disclosure of highly
condential or condential data due to
incomplete or unsuitable identication,
handling, usage, storage, processing or
disposal procedures could lead to adverse
employee privacy and/or reputational
consequences or nancial loss and
operational disruption
• Process to identify and classify data assets to allow
Brambles to prioritise security technology implementations
that offer targeted and appropriate protection
• Data Classication and Handling Policy includes guidelines on
the types of data and protection protocols for each data type
• Regular training (including refresher training) on data
classication and handling is provided to all employees
and contractors
• Brambles has an Acceptable Use Policy which outlines the
standards by which all users must use information and
technology assets and services. Preventative controls are
also in place to mitigate the risk of loss or misuse of data.
These controls include the encryption of laptops, mobile
devices, email data retention controls and the ability to
store data in secure drives
• Brambles has an Information Management Strategy and
Data Governance Framework with which it continues to
seek opportunities to enhance the management of data
and data security
Risk Implication Mitigating Actions
Network capacity
The scale and strength of Brambles’
network of service centre locations
is inherent to its value proposition for
customers and other stakeholders.
A lack of capacity within the network
in a major market could adversely
impact service delivery, competitive
position, and nancial performance
• Brambles has contingency plans in place to enable it to run
operations and support customers and their consumers
despite economic uncertainty and restrictions arising from
physical and geopolitical events
• Automation within service centres drives both capacity
and capability across the network
• Ongoing investment in innovations in automation continue to
be made across the global network; for example, the touchless
repair unit called Integrum
• As part of the Task Force on Climate-related Financial
Disclosures framework response, Brambles conducted an
assessment of service centres to evaluate the network’s
resilience against physical climate change events and using
those ndings to inform a more integrated approach to
network resilience (see page 21 for more details)
Customers and
competitors
Brambles operates in competitive
markets. A failure to meet customer
expectations could erode Brambles’
customer value proposition and
competitive differentiation which
could cause current and prospective
customers to use alternative supply chain
solutions, resulting in adverse impacts
on current market share, growth, nancial
performance and overall brand reputation
• Leveraging Brambles’ unique global scale, network advantage
and sustainable business model to support customers with
meeting the ongoing volatility in consumer supply chains
• Collaborating with customers to understand and meet their
evolving needs. Adopting digital and other technologies
to innovate products and services, enhance customer
experience and strengthen competitive advantage
• Investment in customer facing technology to improve the
customer experience
• Implementation of programmes to facilitate customer
advocacy of Brambles’ pooled solutions
• Supporting customer sustainability objectives by leveraging
Brambles’ sustainability credentials and circular business model
• Adoption of customer experience scorecards to measure the
impact of customer initiatives to reduce friction points
• Adoption of net promoter score and ‘delivery in full,
on time’ performance metrics for short-term incentive
based remuneration
Retailer
acceptance of
pooled solutions
Retailers are integral to Brambles’
operating model. A failure to maintain
and/or improve retailer advocacy for
Brambles’ pooling solutions could
result in a loss of customers and/or
missed opportunities to increase market
penetration, and consequently result
in an adverse impact on Brambles’
nancial performance, market share and
brand reputation
• Dedicated teams with executive-level responsibility for
strengthening retailer relationships, identifying retailer-specic
product requirements and ensuring retailers understand
Brambles’ value proposition
• Improving the value proposition for retailers through the
implementation of joint business plans and adopting the value
sharing concept to create win-win opportunities
• Implementation of programmes to facilitate retailer advocacy
of Brambles’ pooled solutions
• Supporting retailer sustainability objectives by leveraging
Brambles’ sustainability credentials and circular business model
Material Risks continued
2928
Brambles 2023 Annual Report Operating & Financial Review
Risk Implication Mitigating Actions
Digital disruption
The development of value-generating
and cost-effective digital supply chain
solutions has the potential to materially
change supply chain dynamics. If a
third-party were to develop such solutions
before Brambles, it could adversely impact
Brambles’ business models. This could
result in loss of customers and/or
market penetration and adversely impact
Brambles’ nancial performance
• Brambles is leveraging digital and analytics capabilities to
assist its businesses in managing asset losses and driving
asset eciency more effectively
• The Brambles Digital Function continues to develop
capabilities and technical solutions to expand the application
of data and digital across Brambles’ business and customer
offering including innovation of products and services in
the digital space
• The Digital Function is also innovating, developing, testing, and
rening digital solutions, which have the potential to provide
commercial digital services to its customers
Safety
Brambles is subject to inherent safety
risks associated with its operations
including industrial hazards and road
trac or transportation accidents that
could potentially result in serious injury
or fatality to employees, contractors,
customers, suppliers, or members of
the public
• The Zero Harm Charter states that everyone has the right
to be safe at work and to return home as healthy as they
started the day. Brambles is committed to delivering on
its ambition of Zero Harm to anyone in the course of its
business undertakings
• Adoption of Safety First strategy to help navigate Brambles
to its Zero Harm ambition
• Continuing enhancement of safety management systems,
including focusing on human and organisation behavioural
principles and implementing additional engineering and
technology-based controls
• The ongoing investment in automation across the network
reduces the risk of injury; for example, the development of
touchless repair units, such as Integrum
• Use of leading and lagging safety metrics, which measure
work-related injuries, lost time, modied duties, and incidents
requiring medical treatment, and near misses with regular
reporting and monitoring to the Brambles Board
• All third parties that support Brambles’ business operations
are contractually required to comply with applicable safety
laws and regulations
Transformation
execution
Brambles is currently undergoing a
Group-wide transformation through the
Shaping Our Future programme. If the
strategic priorities and objectives of that
programme are not successfully executed,
Brambles may be prevented from realising
its long-term potential and continuing
competitive advantage. This could
adversely impact Brambles’ ability to
deliver against its customer, investor,
and sustainability value propositions and
could lead to a loss of market condence
in Brambles’ ability to create future
shareholder value
• Twin-track approach to transformation driving increased
performance and resilience of the current business while
increasing investment to create the ‘Brambles of the Future’
• Dedicated Transformation Oce, led by the Chief Transformation
Ocer, to assure, enable and drive rigorous governance and
cadence, developing transformational capabilities and tools
across the business, actively solving problems, and co-owning
the transformation together with the operating businesses
• Active ownership and leadership of the transformation
programme by the ELT
• Detailed scorecard to progressively measure outcomes
across the transformation journey, with a balance of nancial and
non-nancial, and leading and lagging metrics
• Dedicated Chief Digital Ocer responsible for the Brambles
Digital Function
• Enabling effective change delivery by building transformation
capabilities across the Group, fostering company-wide shared
ownership, and creating an agile culture of testing, learning,
adapting, and improving
• Leveraging existing best practice, as well as a strong
pipeline of new initiatives to drive future value creation
• Investment in training and skills to support delivery of
transformation programme
• Embedding a culture of test and learn, necessary to evolve
new business models and customer solutions
Risk Implication Mitigating Actions
Timber supply
(including access
to sustainable
timber sources)
Access to sustainably certied sources
of timber is essential for Brambles to
carry on its business. In addition, timber
supply requires a balance between raw
material availability, sawmill and pallet
manufacturer capacity. There is a risk
that a concentration at any of the three
levels of the timber supply chain in any
region, or a shortage of available certied
sources of timber, could adversely impact
Brambles’ ability to maintain its timber
pallet pool at levels that will enable it
to meet customer demand for those
products. This could result in loss of
customers and/or market penetration
and adversely impact Brambles’ nancial
performance. Climate-related risks for
forests and timber supply, including
market, regulatory and physical risks,
will emerge over a ve-to-ten-year period
• In response to the timber supply shortages and cost ination
caused by various disruption events (including the war in
Eastern Europe and global supply chain challenges), dedicated
global and regional timber procurement teams manage timber
procurement and mitigate timber supply risks. This includes
onboarding new suppliers of FSC/PEFC accredited timber and
expanding the availability of FSC/PEFC accredited timber in
the market by working with non-accredited timber farms to
obtain the certication
• The timber procurement strategy is aimed at improving supply
security of certied timber while decoupling the procurement
of timber from market price volatility. This includes activities
such as:
– Building strategic partnerships with timber supplier
networks globally, including forests, sawmills, and
new pallet manufacturers;
– Creating the Timber Supply Climate Risk Tool to assess
climate risks in key geographic areas related to its
timber-sourcing supply chains; and
– Developing a sustainable sourcing model to create a
dependable pipeline of sustainably certied timber
• In line with Brambles’ 2025 sustainability targets, 100%
of timber is sourced from certied sources. Brambles has
continued to meet year-on-year improvement targets of
sourcing Chain-of-Custody certied timber
Regulatory
compliance
Brambles operates in a large number
of countries with widely differing legal
regimes, legislative requirements, and
compliance cultures. In addition, the
regulatory landscape continues to evolve
rapidly in areas such as privacy, human
rights and ESG related matters. A failure
to comply with regulatory obligations
and local laws could adversely affect
Brambles’ operational and nancial
performance and its reputation
• Dedicated Chief Compliance Ocer responsible for monitoring
the implementation and ongoing application of compliance
management systems
• A Code of Conduct provides a framework for detailed policies
addressing regulatory compliance
• A vendor due diligence, ESG compliance scorecard and ongoing
audit programme to assess the compliance of suppliers with
various legal and regulatory requirements, such as bribery and
corruption, sanctions violations, modern slavery and human
rights practices, privacy, and environmental risks
• Adoption of Group-wide online compliance training
programmes to supplement face-to-face training
• Regular cadence of Board reporting on regulatory matters,
whistleblowing incidents, and ESG matters against an
ESG scorecard
People and
capability
Brambles’ employee value proposition
and culture may fail to attract, develop
and/or retain diverse, motivated and
high performing individuals with the
capabilities to support the delivery
of our current and future strategic
objectives. This could adversely impact
Brambles’ ability to implement and
manage its strategic objectives and
transformation plans
• Detailed talent management and succession planning
processes to identify high-potential employees and prepare
successors for senior executive positions
• Adoption of development programmes for management,
leadership, and functional expertise through all
employment levels
• Formal mentoring programmes offered to employees
• A policy of hybrid working and a global wellbeing strategy to
empower and enable all employees to thrive
• A digital employee value proposition to attract data and digitally
skilled talent in support of our transformation programme
• Developing new skills internally through training
and development
• Providing pathways for service centre employees to progress
their careers
Material Risks continued
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Brambles 2023 Annual Report Operating & Financial Review
Risk Implication Mitigating Actions
Diversity, equity
and inclusion
(DE&I)
Brambles has a diverse workforce
and believes that an inclusive work
environment allows employees to realise
their full potential, regardless of gender,
race, religion, age, disability, ethnicity,
sexual orientation, or any other factor that
makes an individual unique. Brambles
harnesses the unique and diverse
strengths of its employees to better serve
its customers and to grow its business.
Any activities or practices within its
operations or in its supply chains that
could undermine this intent violates
Brambles’ values and are detrimental to
the integrity and credibility of its brands
• Brambles fosters a diverse, equitable and inclusive
environment, to be better able to relate to customers, suppliers,
communities, and co-workers
• Continuing progress in improving gender diversity at all levels
within the organisation, including Board, executive leadership,
and management positions
• Brambles’ Global Inclusion and Diversity Council coordinates
programmes and initiatives to encourage, celebrate and
support all forms of diversity
• Employee Resource Groups focus on a wide variety of DE&I
topics including race, gender balance, disability, veterans
support, ethnic minorities, neurodiversity and LGBTQIA+
Human rights
Brambles conducts operations in
~60 countries. There is a risk that
human rights violations (including
modern slavery) may occur in its
operations or across its supply chains.
This could result in nancial loss, legal
and regulatory action and damage to
its reputation
• A Code of Conduct which sets out behavioural requirements
relating to human rights
• A separate Human Rights Policy which sets out Brambles’
commitment to respecting all internationally recognised
human rights
• Mandatory training programmes
• Third Party Due Diligence Programme which focuses, amongst
other things, on suppliers’ human rights policies and processes
• Implementation of a Supplier Academy to assist suppliers in
understanding Brambles’ human rights requirements
• Launch of a human rights audit programme
• Standard Operating Procedure governing the management
of modern slavery risk in third party plant operations
Sustainable timber
sourcing
See page 30 • See page 30
Safety
See page 31 • See page 31
Risk Implication Mitigating Actions
Environmental and Social Risks
Climate change
Climate change is inuencing both
acute short-term weather events and
longer-term chronic climate trends.
These climate-related impacts are
inuencing society, business and
consumer purchasing behaviour both in
terms of physical acute or chronic severe
weather-related events and/or transitional
risks including changes in markets,
technology, policy, legal requirements, and
reputational expectations. Responding to
the specic challenges of climate
change is intimately linked to Brambles’
sustainable, low-carbon circular ‘share and
reuse’ model
• Brambles is intrinsically a low-carbon intensity business
• Brambles is a sustainable business because of its circular
‘share and reuse’ model, which reduces carbon emissions,
demand on natural resources, and eliminates waste for
customers in the world’s supply chains
• As a leader in the circular economy, Brambles understands
the potential to address climate change by focusing on both
its impact on climate change and the impact of climate
change on Brambles
• Brambles’ network density and dispersed footprint provides
inherent resilience against extreme climate events such as
oods, droughts, wildres etc. Brambles continues to evaluate
the impact of such events on its network and implement
robust mitigations
• Brambles has adopted the TCFD framework with an ongoing
project to assess the risks and opportunities for the business
using climate scenario analysis (further details on TCFD are
on pages 20-22)
• Brambles is committed to a 1.5ºC climate future aligned
with the Paris Agreement and carbon emissions SBT. It has
established its 2030 SBT covering its Scope 1, 2 and 3
emissions. Brambles has also committed to achieving net-zero
carbon emissions by 2040
• As part of its Climate Positive targets, Brambles has
maintained its carbon-neutral position since June 2021 and
100% of the electricity used at its service centres is from
renewable sources. This includes electricity from renewable
contracts 39%, on-site generation 3% and Energy Attribute
Certicates (EACs) 58%
• Brambles’ demand for sustainably sourced timber addresses
deforestation and its impact on climate change through its
2025 afforestation target
• Brambles’ climate change reporting (as part of the wider
sustainability reporting) is in line with the requirements of
the TCFD. Plans are in place to progressively align with the
standards issued by the International Sustainability Standards
Board over FY24/25
• Compliance and control systems in place to mitigate the risk
of greenwashing
Emissions targets
As a part of its climate change risk
management and sustainability goals,
Brambles has set publicly stated 2030
SBT for its Scope 1, 2 and 3 emissions.
If Brambles fails to achieve those targets,
or does not comply with greenhouse gas
emissions laws, it may incur nancial loss,
be subject to legal or regulatory action or
suffer reputational damage
• In addition to the actions in the Climate Change Risk, Brambles
has a dedicated decarbonisation function and has developed
an actionable roadmap to assist it in achieving this goal with
2030 targets for each of its regions
Material Risks continued
3332
Brambles 2023 Annual Report Operating & Financial Review
Financial Review
1. Financial Review
1.1 Group Overview
1.1.1 Summary of 2023 Financial Results
US$m Change
(Continuing operations) FY23 FY22 Actual FX Constant FX
CHEP Americas 3,371.0 2,950.8 14% 14%
CHEP EMEA 2,191.1 2,072.5 6% 14%
CHEP Asia-Pacific 514.7 496.5 4% 11%
Sales revenue 6,076.8 5,519.8
10% 14%
Other income and other revenue 318.9 287.7
11% 12%
CHEP Americas 573.3 482.3 19% 19%
CHEP EMEA 506.5 461.2 10% 18%
CHEP Asia-Pacific 180.5 169.0 7% 15%
Corporate (193.3) (182.5) (6)% (11)%
Underlying Profit
1,067.0 930.0 15% 19%
Significant Items
- -
Operating profit 1,067.0 930.0 15% 19%
Net finance costs (114.1)
(86.3) (32)% (34)%
Net impact from hyperinflationary economies
1
(18.7) (22.0) 15% 15%
Tax expense
(287.1) (247.9) (16)% (20)%
Profit after tax from continuing operations 647.1 573.8 13% 18%
Profit from discontinued operations 56.2 19.5
Profit after tax 703.3 593.3 19% 24%
Average Capital Invested 5,763.6 5,150.5 12% 16%
Return on Capital Invested 18.5% 18.1% 0.4 pts 0.5 pts
Weighted average number of shares (m
illions) 1,388.0 1,415.7 (2)% (2)%
Basic EPS (US cents) 50.7 41.9 21% 26%
Basic EPS from continuing operations (US cents) 46.6 40.5 15% 20%
Note on FX: The variance between actual and constant FX performance reflects the appreciation of Brambles' reporting
currency, the US dollar, relative to key operating currencies.
FY23 Operating Environment
During the Year, Brambles and its customers continued to face
uncertain macroeconomic conditions, inflationary cost
pressures and inefficiencies across global supply chains.
Inflationary cost pressures remained challenging during the
Year with the cost of raw materials remaining above historic
levels, despite some moderation in lumber costs globally and
US transport costs in 2H23. Brambles’ weighted average cost
of new pallets in FY23 remained above FY22 levels although,
consistent with the trend in lumber costs, the cost of new
pallets trended downwards in most regions in 2H23.
In addition to inflationary pressures, ongoing inefficiencies
across supply chains also contributed to cost-to-serve
increases in all regions. Elevated inventory levels held by
customers and retailers to de-risk their supply chains and
1
The net impact of US$18.7 million (2022: US$22.0m) reflects the application of AASB 129 Financial Reporting in Hyperinflationary Economies.
pallet availability challenges, most evident in 1H23, resulted in
increased pallet cycle times, unauthorised reuse of pallets and
higher loss rates.
In response to these market conditions, Brambles continued
to work with its customers and retailer partners to improve
pallet availability. It also adapted its commercials terms,
increased pricing and asset compensations to reflect the
increased operating and capital cost-to-serve and invested in
numerous asset productivity initiatives which resulted in ~10
million pallets being recovered and salvaged during the Year.
During 2H23, as anticipated, there was evidence of
progressive inventory optimisation across manufacturer and
retailer supply chains with ~5 million additional pallets
returned across Brambles’ major markets. Brambles expects an
Financial Review – continued
additional ~5-7 million pallet returns in FY24 due to
progressive destocking at retailers and manufacturers.
Collectively, these additional pallet recoveries and returns,
together with investment in the pallet pool, contributed to
improved pallet availability and increased service levels across
the network in 2H23. The increased pallet availability across
major markets enabled the businesses to rebuild plant stock
levels to support improved operational efficiencies and
remove or materially reduce allocation protocols during 2H23.
Specifically, in North America and Europe, the improvement in
pallet availability has also allowed these businesses to pursue
new customer wins. The focus is on converting whitewood
users to pooled solutions in the US, and to target both lane
expansions as well as new customer wins in Europe.
Despite some early signs of new customer wins in 2H23 in our
major markets, the volume impact of this did not offset
weakness in underlying pallet demand given macroeconomic
pressures on consumption and the impact of inventory
destocking on volume.
Given the uncertain operating conditions, the strong financial
results, including ROCI expansion, demonstrate the quality
and inherent resilience of Brambles’ business. The results also
reflect operating cost and capital investments in the
transformation programme, which delivered material benefits
in the Year and is also supporting future value creation.
Benefits include improvements in commercial terms to
support recovery of cost-to-serve, delivery of operational
efficiencies and asset productivity benefits.
Impact of Hyperinflation economies on actual and
constant FX translations
At actual FX rates, the results for Argentina, Türkiye and
Zimbabwe have been retranslated from local currency to
USD using the 30 June 2023 period-end spot rate.
During 4Q23, Brambles updated its constant-currency
methodology for hyperinflation, eliminating any FX impact
arising from retranslating the financial results for Brambles’
hyperinflationary economies of Argentina, Türkiye and
Zimbabwe. The impact on previously reported constant
currency growth rates during FY23 are as follows:
- ~2 percentage points reduction in the 15% revenue
growth reported for the first nine months of FY23;
- ~1 percentage point reduction in the 14% revenue
growth reported for 1H23.
Sales revenue from continuing operations of
US$6,076.8 million increased 14% at constant currency driven
by price growth of 16% reflecting commercial discipline in
recovering both operating and capital cost-to-serve increases
in all regions. This price realisation reflected contributions
from contractual repricing and indexation initiatives taken in
both the current and prior year as well as specific pricing
actions to address high-risk lanes.
2
Sales revenue contribution to profit is defined as the sales revenue growth net of demand-related activity costs. In FY23, sales growth included a (2)% decline in
volume with the associated profit impact being partially offset by lower demand-related plant and transport costs.
Overall volumes declined (2)% with lower like-for-like volumes
of (3)% partially offset by net new business growth of 1% in
the period.
Like-for-like volumes declined (3)% due to a combination of
pallet availability challenges in 1H23 and lower underlying
demand in the European and US pallet businesses, reflecting
macroeconomic pressures on consumer demand and some
inventory optimisation across retailer and manufacturer
supply chains. These declines were partly offset by growth
with existing customers in the Asia-Pacific pallet and
RPC business and the global Automotive business.
Net new business growth of 1% was driven by the European
pallet business. This primarily reflected rollover contributions
of prior year contract wins and, to a lesser extent, customer
conversions in 2H23, as improved pallet availability allowed
the business to recommence pursuing new customers.
Other income and other revenue of US$318.9 million
increased by US$36 million at constant currency and included
US$217.4 million of income relating to North American
surcharges, which are pricing mechanisms to recover the
impact of fuel, transport and lumber inflation on the operating
and capital cost-to-serve in the region.
North American surcharge income in the Year decreased
US$7 million at constant currency reflecting lower lumber
surcharge income in line with lower market lumber price
indices. This was largely offset by the impact of higher fuel
prices on transport surcharges.
The balance of other income and the year-on-year increase of
US$43 million relates primarily to the profit on disposal of
assets and includes the Australian flood insurance proceeds of
US$8 million recognised in 1H23.
Underlying Profit and Operating profit of
US$1,067.0 million increased 19% at constant currency
as contributions from pricing actions offset cost-to-serve
increases including input-cost inflation and higher asset
charges, and incremental overhead investments to
support growth and the delivery of benefits from the
transformation programme.
The ~US$35 million of plant and transport cost benefits
recognised in 1H23 due to lower pallet return rates, largely
reversed in 2H23 in line with the ~5 million additional pallet
returns across Brambles’ major markets, driven by progressive
inventory optimisation across retailer and manufacturer
supply chains.
At the Group level, the sales revenue contribution to profit
2
of
US$815 million more than offset:
- Plant cost increase of US$226 million, reflecting input-
cost inflation (including repair lumber) of US$139 million,
investments in quality improvement initiatives, additional
repair and handling costs to remanufacture pallets and
service customer demand with sub-optimal plant stock
levels during the Year. These cost increases were partly
offset by efficiency benefits from automation investments
34 Operating & Financial Review Operating & Financial Review 35
Financial Review – continued
in the major pallet markets and the Australian RPC
business, damage rate reductions and other supply chain
improvements in the US and European pallet businesses;
- Transport cost increases of US$93 million, reflecting fuel
and transport inflation of US$46 million and additional
relocations associated with sub-optimal plant stock levels,
higher pallet return rates and additional recovery
activity which delivered asset efficiency benefits across
the Group;
- North American surcharge income decreased
US$7 million as lower lumber surcharge income was
partly offset by higher fuel and transport surcharges;
- Depreciation expense increases of US$73 million
reflecting growth in the pallet pool and the impact of
pallet price inflation;
- IPEP expense increase of US$56 million, largely driven by
higher losses in the US and to a lesser extent in the
European pallet businesses, due to supply chain
dynamics;
- Shaping Our Future transformation cost increases of
US$5 million as incremental investments of US$31 million
in digital transformation, customer experience and
other productivity initiatives were partly offset by a
US$26 million decrease in short-term transformation
costs; and
- Other cost increases of US$177 million included cost
inflation and overhead investments to support growth
and the delivery of transformation benefits in the Year
and future value creation initiatives across the Group.
These increases were partly offset by higher asset
compensations and one-off insurance proceeds in
Australia of US$8 million.
Profit after tax from continuing operations of
US$647.1 million increased 18% at constant currency,
driven by the strong operating profit result.
Net finance costs increased US$29 million at constant
currency, mainly reflecting higher interest rates on variable-
rate debt as well as higher average net debt following the
completion of the share buy-back programme at the end of
the prior year.
The net charge of US$18.7 million arising from
hyperinflationary economies mainly relates to Brambles'
operations in Türkiye and Argentina.
Tax expense of US$287.1 million increased 20% at constant
currency, reflecting higher earnings. The FY23 underlying
effective tax rate of 30.1% increased 0.7pts on prior year levels
reflecting increased Base Erosion and Anti-Abuse Tax (BEAT)
in the US, and the mix of global earnings.
Profit from discontinued operations of US$56.2 million
relates to the gain on divestment of CHEP China which is
recognised as a discontinued operation following the
completion of the merger with Loscam (Greater China) in
March 2023. Prior year profit from discontinued operations
includes the revaluation gain on the loan receivable from
First Reserve with the related funds received in 1H23.
Brambles Basic EPS of 50.7 US cents increased 26% at
constant currency, reflecting the Group profit after tax growth
of 24% and ~2 percentage point benefit from the share buy-
back programme which was completed in FY22.
Return on Capital Invested was 18.5%, up 0.5 percentage
points at constant currency as the strong Underlying Profit
performance more than offset a 16% constant currency
increase in Average Capital Invested. The increase in
Average Capital Invested includes the full-year impact of
pallets purchased at record prices in 2H22 and higher than
historical prices in 1H23 compared to the prior year.
Cash Flow Reconciliation
US$m FY23 FY22 Change
Underlying Profit 1,067.0 930.0 137.0
Depreciation and amortisation 730.1 679.5 50.6
IPEP expense 285.1 232.0 53.1
Underlying EBITDA 2,082.2 1,841.5 240.7
Capital expenditure
(cash basis)
(1,659.2) (1,625.1) (34.1)
Proceeds from sale of PP&E 189.8 168.3 21.5
Working capital movement 57.6 (40.2) 97.8
Purchase of intangibles (16.1) (19.8) 3.7
Other 135.5 67.1 68.4
Cash Flow from Operations 789.8 391.8 398.0
Significant Items - (0.5) 0.5
Discontinued operations 34.7 (21.0) 55.7
Financing and tax costs (326.4) (284.1) (42.3)
Free Cash Flow before
dividends
498.1 86.2 411.9
Dividends paid (318.6) (304.8) (13.8)
Free Cash Flow after
dividends
179.5 (218.6) 398.1
Cash Flow from Operations of US$789.8 million increased
US$398.0 million on the prior year as higher earnings and
favourable working capital movements were partly offset by
slightly higher cash capital expenditure in the period.
On a cash basis, capital expenditure of US$1,659.2 million
increased US$34.1 million, reflecting the reversal of
abnormally high capex creditors in the prior year, driven by
both record pallet prices and the timing of pallet purchases
in the fourth quarter of FY22 and paid for in FY23. This
was largely offset by an ~8 million reduction in the number
of pallet purchases in the Year which equated to
~US$200 million of pooling capex savings in the Year.
On an accruals basis, capital expenditure decreased
US$159.7 million at constant currency, due to a reduction in
the total number of pallets purchased in FY23, driven by
lower volume-related growth in the Year relative to the
prior year, incremental asset recovery and scrap reduction
initiatives as well as benefits from inventory destocking,
primarily in the US and Europe. These savings more than
offset ~US$60 million impact of lumber inflation on pallets
purchased in the Year as well as additional pallet investments
in response to higher loss rates in the US and
European businesses.
Financial Review – continued
Non-pooling capital expenditure increased US$5.2 million,
reflecting incremental investments in automation initiatives in
Europe, partly offset by reductions in North America and
Australia, as the businesses cycled higher investments in the
prior year.
Proceeds from the sale of PP&E increased US$21.5 million
reflecting improved pallet compensation recoveries in the
period and the one-off Australian flood insurance proceeds.
The year-on-year favourable movement in working capital of
US$97.8 million largely reflected lower inventory holdings in
North America and timing of payments across the Group.
Approximately US$50 million of this benefit is expected to
reverse in FY24.
Other increase of US$68.4 million largely reflects deferred
revenue driven by increased sales and longer cycle times and
higher provisions including employee benefits partly offset by
non-cash adjustments mainly relating to asset disposals. This
includes ~US$40 million of timing benefits that are expected
to reverse in FY24.
Free Cash Flow before dividends of US$498.1 million increased
US$411.9 million on the prior year largely reflecting the
Cash Flow from Operations performance.
Cash flow from discontinued operations increased
US$55.7 million and included the US$41.5 million final
settlement from First Reserve received in 1H23, and the
operating cash flow from CHEP China, which is recognised
as discontinued operations following the completion of the
merger with Loscam (Greater China) in March 2023.
Cash outflows relating to financing costs and tax increased
US$42.3 million reflecting higher net finance costs due to
increased interest rates on variable-rate debt, as well as
higher average borrowings following the completion of the
share buy-back programme in FY22, and the phasing of cash
flow generation weighted to 2H23. Net tax paid increased
US$11.2 million due to higher BEAT costs in the US.
Free Cash Flow after dividends of US$179.5 million increased
US$398.1 million on the prior year.
Dividend payments in the period increased US$13.8 million as
higher dividends per share were partly offset by a reduction in
the shares on issue following the completion of the share buy-
back programme in FY22 and FX movements.
Segment Analysis
1.1.2 CHEP Americas
US$m Change
FY23 FY22
Actual
FX
Constant
FX
Pallets 3,335.4 2,914.2 14% 14%
Containers 35.6 36.6 (3)% (2)%
Sales revenue 3,371.0 2,950.8 14% 14%
Underlying Profit 573.3 482.3 19% 19%
Average Capital
Invested
3,033.3 2,659.9 14% 14%
Return on Capital
Invested
18.9% 18.1% 0.8pts 0.7pts
Sales Revenue
Pallets sales revenue of US$3,335.4 million increased 14% at
constant currency reflecting contributions from pricing
initiatives taken in the current and prior year to recover cost-
to-serve increases across the region. Pallet volumes decreased
(3)% as like-for-like volume declines in the US were partly
offset by expansion with new customers in Latin America.
US pallets sales revenue of US$2,424.3 million increased 13%,
made up of:
- Price growth of 18% driven by a combination of rollover
benefits from prior year pricing actions and additional
pricing initiatives taken in the current year to recover
cost-to-serve increases;
- Net new business contributions in line with the
prior year given pallet availability challenges in 1H23.
With improving pallet availability in 2H23, the business
recommenced pursuing new business growth in
2H23; and
- Like-for-like volume decline of (5)% due to softening
consumer demand, the impact of pallet availability
challenges in 1H23, progressive inventory optimisation at
manufacturers and retailers, and some managed loss of
flows unsuited to pooled solutions. Like-for-like volume
performance improved in 4Q23 to a year-on-year decline
of (2)% compared to the 9M23 run rate of a (6)% decline
year-on-year. This improvement in 4Q23 was driven by
increased beverage, dairy and seasonal produce volumes.
Canada pallets sales revenue of US$375.5 million increased
12% at constant currency due to strong pricing growth and
customer mix benefits. Volumes were broadly in line with the
prior year.
Latin America pallets sales revenue of US$535.6 million
increased 23% at constant currency driven by strong pricing
growth to reflect the increased cost-to-serve as well as
volume growth with new customers.
Containers sales revenue of US$35.6 million declined (2)% at
constant currency due to lower volumes more than offsetting
price growth in the North American Intermediate Bulk
Container (IBC) business.
36 Operating & Financial Review Operating & Financial Review 37
Financial Review – continued
Profit
Underlying Profit of US$573.3 million increased 19% at
constant currency as a combination of pricing initiatives and
efficiency gains offset cost-to-serve increases and
transformation investments.
The sales revenue contribution to profit of US$479 million
more than offset:
- Plant cost increases of US$172 million including input-
cost inflation of US$106 million. Other plant cost
increases were largely driven by additional investments in
quality improvement initiatives, remanufacturing costs to
salvage pallets, additional handling costs due to sub-
optimal plant stock balances throughout the Year and
international freight costs on repair lumber, partly offset
by damage rate improvements and efficiency gains in the
US business;
- Transport cost increases of US$43 million, largely
attributable to additional relocation of pallets to
rebalance the network, as well as increased pallet
recoveries including costs associated with using smaller
trucks with higher frequency pickups in the US business;
- Surcharge income decreases of US$7 million as lower
lumber surcharge income in line with falling lumber
prices was partly offset by higher contributions from fuel
and transport surcharges;
- Depreciation expense increases of US$38 million from
higher cost of pallets purchased over the preceding
12 months;
- IPEP expense increases of US$40 million reflecting higher
pallet loss rates as industry dynamics continued to impact
pallet return rates and cycle times, which was partly offset
by benefits from asset productivity initiatives including
increased collections and repair of pallets that would
otherwise have been scrapped; and
- Other cost increases of US$88 million reflecting growth-
related overhead investments including transformation
and asset recovery initiatives, partly offset by increased
pallet compensations and reduced pallet scraps.
Return on Capital Invested
Return on Capital Invested of 18.9% increased
0.7 percentage points at constant currency as strong
Underlying Profit growth was partially offset by an increase of
14% in Average Capital Invested. This primarily reflects the
addition of higher priced pallets to the pool due to lumber
inflation and investments to support longer pallet cycle times
and customer demand.
1.1.3 CHEP EMEA
US$m Change
FY23 FY22
Actual
FX
Constant
FX
Pallets 1,909.6 1,789.9 7% 15%
RPC 27.2 30.3 (10)% 3%
Containers 254.3 252.3 1% 7%
Sales revenue 2,191.1 2,072.5 6% 14%
Underlying Profit 506.5 461.2 10% 18%
Average Capital
Invested
2,218.6 1,990.9 11% 19%
Return on Capital
Invested
22.8% 23.2% (0.4)pts (0.3)pts
Sales Revenue
Pallets sales revenue of US$1,909.6 million increased 15% at
constant currency, driven by continued price momentum to
recover cost-to-serve increases and net new business growth
across the region.
Europe pallets sales revenue of US$1,710.9 million increased
16% at constant currency, comprising:
- Price growth of 18% reflecting pricing actions and
contributions from contractual indexation to recover
cost-to-serve increases;
- Net new business growth of 3% predominantly in
Southern, Central and Eastern Europe which benefited
from rollover contributions from prior year wins as well as
modest benefits from new contract wins in 2H23; and
- Like-for-like volume declines of (5)% due to softening
consumer demand driven by cost-of-living pressures,
macroeconomic headwinds and progressive inventory
optimisation at manufacturers.
India, Middle East, Türkiye and Africa (IMETA) pallets sales
revenue of US$198.7 million, up 4% at constant currency,
reflecting growth in both price and volumes.
RPCs and Containers revenue of US$281.5 million increased
7% at constant currency, comprising:
- Automotive sales revenue of US$194.0 million up 10%,
primarily driven by volume growth in both the North
American and European businesses;
- IBCs sales revenue of US$60.3 million in line with the prior
year; and
- RPCs sales revenue of US$27.2 million up 3%, driven by
pricing initiatives to recover cost-to-serve increases.
Profit
Underlying Profit of US$506.5 million increased 18% at
constant currency. The sales revenue contribution to profit of
US$292 million more than offset:
- Plant cost increases of US$48 million largely driven by
input-cost inflation including labour and lumber of
US$26 million. The balance of the increase in plant costs
was predominantly attributable to increased repair and
handling costs associated with higher pallet return rates
in 2H23 and increased pallet remanufacturing activity;
Financial Review – continued
- Transport cost increases of US$45 million primarily due to
fuel and other transport cost inflation across the region
and including some localised truck fleets used to increase
pallet recollections;
- Depreciation expense increases of US$32 million from
impact of higher unit cost of pallets purchased in the
preceding 12 months;
- IPEP expense increases of US$16 million primarily
reflecting higher pallet loss rates as industry dynamics
continued to impact pallet return rates and cycle times,
which more than offset benefits from asset productivity
initiatives; and
- Other cost increases of US$68 million due to increased
overhead investments, largely related to additional
personnel to support transformation initiatives and
delivery of related benefits, with these costs partly offset
by increased pallet compensations in the European
business.
Return on Capital Invested
Return on Capital Invested of 22.8% decreased 0.3 percentage
points at constant currency largely reflecting the full-year
impact on Average Capital Invested of pallets purchased at
elevated prices in 2H22 as well as FY23 pallet purchases to
support demand, largely offset by the increase in Underlying
Profit in the Year.
1.1.4 CHEP Asia-Pacific
US$m Change
FY23 FY22
Actual
FX
Constant
FX
Pallets 378.0 363.3 4% 12%
RPC 94.4 94.2 - 8%
Containers 42.3 39.0 8% 17%
Sales revenue 514.7 496.5 4% 11%
Underlying Profit 180.5 169.0 7% 15%
Average Capital
Invested 530.4 512.7 3% 11%
Return on Capital
Invested 34.0% 33.0% 1.0 pts 1.1 pts
Corporate actions
CHEP China (formerly part of CHEP Asia-Pacific), has been
recognised in discontinued operations in FY23 following the
completion of the merger with Loscam (Greater China) in
March 2023. Prior year comparatives for CHEP Asia-Pacific
have been restated.
Sales Revenue
Pallets sales revenue of US$378.0 million, increased 12% at
constant currency reflecting continued elevated levels of
demand from existing customers primarily in the Australian
business, and price realisation to recover cost-to-serve
increases. The like-for-like growth reflects increased daily hire
revenue as pallet demand continues to offset the
improvements to pallet returns in 2H23, with cycle times
remaining elevated due to sustained high levels of inventory
balances across manufacturer and retailer supply chains.
RPCs and Containers sales revenue of US$136.7 million
increased 10% at constant currency driven by like-for-like
volume growth in both the RPC and IBC businesses
in Australia.
Profit
Underlying Profit of US$180.5 million increased 15% at
constant currency and includes one-off net income of
US$8 million from insurance proceeds relating to the impact
of floods in Australia. The 1H23 benefit of deferred pallet
repairs, as a result of lower pallet return rates, largely
unwound in 2H23. Excluding the one-off benefit from
insurance proceeds, Underlying Profit increased 10% at
constant currency, as the sales contribution to profit and
automation efficiencies in the Australian RPC business more
than offset plant and transport cost inflation, increased
damage rates due to longer cycle times, and increased
overhead investments, primarily relating to employee costs.
Return on Capital Invested
Return on Capital Invested of 34.0% increased 1.1 percentage
points at constant currency and included a 1.4 percentage
point benefit from the one-off insurance proceeds.
Excluding the insurance proceeds, Return on Capital Invested
decreased 0.3 percentage points at constant currency driven
by the 11% increase in Average Capital Invested as a result of
the additional investment in pallets to support higher
inventory balances and demand across Australian supply
chains as well as the material reinvestment in the business
infrastructure over the last three years.
1.1.5 Corporate
US$m Change
FY23 FY22
Actual
FX
Constant
FX
Short-term
transformation costs (22.5) (48.4) 25.9 25.8
Ongoing
transformation costs (88.1) (60.2) (27.9) (31.0)
Shaping our Future
transformation costs (110.6) (108.6) (2.0) (5.2)
Corporate Costs (82.7) (73.9) (8.8) (15.5)
Underlying Profit (193.3) (182.5) (10.8) (20.7)
Shaping Our Future costs of US$110.6 million increased
US$5.2 million at constant currency, as increased investment
in the transformation was largely offset by a US$25.8 million
reduction in short-term transformation costs. The short-term
costs are broadly consistent with the outlook provided in
August 2022 and include consulting fees as well as internal
resources supporting the delivery of transformation benefits.
Ongoing corporate transformation costs of US$88.1 million
increased US$31.0 million at constant currency, which includes
investments in digital transformation and initiatives to support
asset productivity and customer experience.
Corporate costs of US$82.7 million increased US$15.5 million
at constant currency, primarily reflecting labour-related cost
increases including wage inflation.
38 Operating & Financial Review Operating & Financial Review 39
Board & Executive Leadership Team
Governance Overview
The Board has overall responsibility for:
- Overseeing the effective management and control of the Group on behalf of Brambles' shareholders; and
- Supervising executive management's conduct of the Group's affairs within a control and authority framework that is
designed to enable risk to be prudently and effectively assessed and monitored.
The Board executes its responsibilities with the assistance of three standing committees, being the Audit & Risk Committee,
the Remuneration Committee, and the Nominations Committee. The Board has also delegated responsibility for the day-to-day
management of the business and affairs of the Group to the Executive Leadership Team (ELT) subject to the levels of authority
set by the Board and the matters reserved for the decision of the Board.
The skills and experience of each of Brambles' Directors are set out below. This breadth of business, financial and
international experience gives the Board the range of skills, knowledge and experience essential to govern Brambles,
including an understanding of the health, safety, environmental and community-related issues it faces.
Further details on the Board skills matrix and the responsibilities of the Board, its Committees and the ELT can be
found in Brambles' 2023 Corporate Governance Statement, which is on Brambles' website at brambles.com/corporate-
governance-overview.
Board of Directors
John Mullen Non-Executive Chair (Independent)
Chair of the Nominations Committee and member of the Remuneration Committee
Joined Brambles as a Non-Executive Director and Chair-elect in November 2019 and became Chair on
1 July 2020. He is currently a Non-Executive Director and Chair of Telstra, Non-Executive Director and
Chair-elect of Treasury Wine Estates, a Director of Brookfield Infrastructure Partners LP and Senior
Advisor of the unlisted entity, Toll Group. John will retire from the Telstra Board on 17 October 2023.
Previously, John was CEO of Asciano, Australia’s largest ports and rail operator, from 2011 to 2016.
Prior to that, John had a distinguished career with the DHL Group from 1994 to 2009, ultimately
becoming CEO of DHL Express in 2006. He also served as a Director of Deutsche Post World Net, the
parent company of DHL Express. Before joining DHL, John spent 10 years with the TNT Group,
culminating in the role of CEO of TNT Express Worldwide, which he held from 1990 to 1994. He was
formerly a Non-Executive Director of Brambles (from 2009 to 2011), and has also served as Chair of
Toll Group and a director on the boards of Macquarie Airports Corporation, Embarq LLC (USA),
Transportes Guipuzcoana (Spain) and Ducros Services Rapides (France). He was also Chair of
the US National Foreign Trade Council in Washington from 2008 to 2010. John holds a Bachelor of
Science from the University of Surrey.
Kendra Banks Non-Executive Director (Independent)
Member of the Nominations Committee
Joined Brambles as a Non-Executive Director in May 2022. Kendra has extensive experience across the
retail and technology sectors with a focus on customer insights, commercial management and digital
marketing. Kendra is currently Managing Director, Australia and New Zealand for SEEK Limited. She
j
oined SEEK in 2015 as its Marketing Director and, in 2017, became its Chief Commercial Officer
before taking up her current role in 2018. Prior to joining SEEK, from 2004 to 2012, Kendra held a
number of executive roles at Tesco in the UK including Marketing Director, Tesco.com and Pricing and
Promotions Director. She joined Coles in 2012 where her roles included General Manager, Coles
Brand (Private Label) and Customer Insight. Kendra started her career as a consultant with
McKinsey & Company. Kendra holds a Bachelor of Arts, Economics and Mathematics from
Yale University and Master of Arts, European Political and Administrative Studies from the
College of Europe.
Board & Executive Leadership Team – continued
Graham Chipchase Chief Executive Officer
Chair of the Executive Leadership Team and member of the Nominations Committee
Joined Brambles at the beginning of January 2017 as CEO Designate and became CEO on
20 February 2017. Prior to Brambles, Graham was CEO of Rexam plc, one of the world’s largest
consumer packaging companies, from 2010 to June 2016. Graham had first joined Rexam in 2003 as
Group Finance Director before moving to Group Director of Plastic Packaging. He left Rexam in June
2016, after Rexam was successfully acquired by Ball Corporation. Graham was a Non-Executive
Director of AstraZeneca plc from 2012 until 2021, including being Chair of its Remuneration
Committee from 2015 to 2020 and Senior Independent Director from 2019 to 2021. He holds an
MA (Hons) Chemistry from Oriel College, Oxford, and is a Fellow of the Institute of Chartered
Accountants in England and Wales.
George El-Zoghbi Non-Executive Director (Independent)
Member of the Nominations and Remuneration Committees
Joined Brambles as a Non-Executive Director in January 2016. George has extensive international
consumer packaged goods and supply chain experience. He is currently the CEO of The Arnott’s
Group. He is also a Strategic Advisor to Altimetrik, a US-based digital and IT solutions company.
Previously, George was the COO of US commercial businesses for Kraft Heinz Company from the
merger of Kraft Foods Group and H.J. Heinz in July 2015 until October 2017 and a Director of
Kraft Heinz Company from April 2018 to April 2021. Prior to that merger, George held a number of
key leadership roles at Kraft including COO. Prior to joining Kraft in 2007, he held a number of
executive roles with Fonterra Cooperative and various managerial and sales roles with Associated
British Foods. He holds a Diploma of Business, Marketing, as well as a Master of Enterprise from the
University of Melbourne and has also completed an Accelerated Development Programme at
London Business School.
Elizabeth Fagan CBE Non-Executive Director (Independent)
Member of the Audit & Risk and Nominations Committees
Joined Brambles as a Non-Executive Director in June 2018. Elizabeth has extensive experience in the
international retail sector. She is a Commander of the Order of the British Empire (CBE). Currently, she
is Chair of the Board of D2N2 Local Enterprise Partnership. Previously, she was the Non-Executive
Chair of Boots UK & Ireland, Senior Vice President and Managing Director of Boots, leading all Boots
businesses across the UK and the Republic of Ireland. Prior to that, she was Senior Vice President,
Managing Director, International Retail for Walgreens Boots Alliance, from the Company’s creation in
December 2014 to 2016, Marketing Director of Boots and Managing Director of Boots Opticians, and
previously worked for Boots as Group Buyer from 1983 to 1991. Before rejoining the Boots business
in 2006, Elizabeth worked for DSG International plc for 10 years, where she held a number of senior
positions, including Marketing Director, Group Marketing Director and Managing Director of The Link.
She holds a Bachelor of Science, Biochemistry, from Strathclyde University and an Honorary Doctorate
of Science from Nottingham Trent University.
Board & Executive Leadership TeamBoard & Executive Leadership Team40 41
Board & Executive Leadership Team – continued
Ken McCall Non-Executive Director (Independent)
Member of the Audit & Risk and Nominations Committees
Joined Brambles as a Non-Executive Director in July 2020. Ken’s background is in global network
management, international logistics and supply chain, having held leadership positions including
Chief Executive, DHL Express UK & Ireland, from 2008 to 2010, and Managing Director, Networks and
Operations, DHL Express Europe, which consolidated his extensive experience of continental Europe.
He lived and worked in China during his time with TNT NV, as CEO TNT China, 2004 to 2007, and
CEO TNT Asia, Middle East, Africa & Indian Subcontinent, 1996 to 2004. More recently, Ken served as
Deputy Group CEO at Europcar Mobility Group from 2016 to 2019, having previously held the roles of
Group COO and Group Managing Director for the UK. Ken has more than 10 years’ experience as a
Non-Executive Director. He served on the board of global fashion retailer SuperDry plc from
2010 to 2016 and was a member of its Audit and Remuneration Committees, and on the board of
Post Office Limited from 2016 to January 2022 at which he was Senior Independent Non-Executive
Director, Chair of the Remuneration Committee and a member of the Nominations and Audit,
Risk and Compliance Committees. Ken is a member of the Chartered Institute of Transport and
Logistics, Singapore.
Jim Miller Non-Executive Director (Independent)
Member of the Nominations and Remuneration Committees
Joined Brambles as a Non-Executive Director in March 2019. Jim has extensive operational and cross-
functional supply chain experience in digital technology. Jim is currently a Non-Executive Director of
The RealReal, a US e-commerce company, and LivePerson, a global technology company that
develops conversational commerce and AI software. Jim has held a number of senior executive roles,
including Chief Technical Officer with US-based e-commerce company Wayfair Inc. from 2020 to
June 2022, and Vice President, Worldwide Operations for Google Inc. from 2010 to 2018, where he
was responsible for global operations, planning, supply chain and new product introduction for
Google’s IT infrastructure and Google Fiber. Previously, he was Executive Vice President, Industrial,
Automotive and Multi-Media for Sanmina Corporation from 2009 to 2010, where he was responsible
for its industrial, clean tech, multi-media and automotive businesses. Prior to that, he held various
executive roles at Cisco Systems, and was Vice President Global Supply Chain for Amazon where he
was responsible for the inception of its supply chain organisation. He has also held various executive
roles at IBM and Intel. Jim holds a Bachelor of Science, Aerospace Engineering, from Purdue
University, and a Master of Science and Engineering and a Master of Science and Management from
the Massachusetts Institute of Technology.
Nessa O'Sullivan Chief Financial Officer
Member of the Nominations Committee
Joined Brambles in October 2016 and was appointed to the role of CFO on 17 November 2016. She
became an Executive Director of Brambles in April 2017. Prior to joining Brambles, Nessa worked for
10 years at Coca-Cola Amatil in a number of senior financial and operating roles, including Group
CFO from 2010 to May 2015. She was also Group CFO for Operations and CFO for Australia and New
Zealand. Nessa began her career working as an auditor at Price Waterhouse in Dublin, New York and
Sydney. She spent two years at Tyco Grinnell Asia Pacific before joining PepsiCo/Yum! Restaurants in
1995. Over a 10-year period at Yum! Restaurants International, she held a number of senior finance, IT
and strategy roles, including five years as CFO for the South Pacific Region. She is also a Non-
Executive Director of Molson Coors Beverage Company. Nessa is a Fellow of the Institute of Chartered
Accountants in Ireland. She holds a Bachelor of Commerce from University College Dublin and is a
graduate of the Australian Institute of Company Directors. Nessa will retire as a Director and as
CFO on 13 October 2023.
Board & Executive Leadership Team – continued
Scott Perkins Non-Executive Director (Independent)
Chair of the Remuneration Committee and member of the Audit & Risk and Nominations Committees
Joined Brambles as a Non-Executive Director in June 2015. Scott is currently Chair of Origin Energy
and of Woolworths Group. Scott has extensive experience in corporate strategy, capital markets and
investment banking. He held senior executive leadership positions at Deutsche Bank from 1999 to
2013, including as Managing Director and Head of Corporate Finance for Australia and New Zealand
and as a member of the Asia-Pacific Management Committee. Scott is also active in the charity and
public policy sector as the founder or director of a number of organisations. Scott holds a
Bachelor of Commerce degree and a Bachelor of Laws with Honours degree from the
University of Auckland.
Priya Rajagopalan Non-Executive Director (Independent)
Member of the Nominations Committee
Joined Brambles as a Non-Executive Director on 1 November 2022. Priya is currently Chief Product
Officer for FourKites, a leading logistics technology firm based in Chicago, USA, which provides real-
time supply chain visibility solutions to its global customers. Priya was a founding product leader of
FourKites and has led its product and sales growth strategies since 2016. She has over two decades of
experience in product management, marketing and strategy, most recently in digital platforms for
global supply chains. Previously, she held a number of product management roles for the
Metadata Business Group of TiVo (previously Rovi) and Flexera Software. Priya holds a Bachelor of
Mathematics from the University of Madras and an MBA from the Kellogg School of Management at
Northwestern University.
Nora Scheinkestel Non-Executive Director (Independent)
Chair of the Audit & Risk Committee and member of the Nominations Committee
Joined Brambles as a Non-Executive Director in June 2020 and became Chair of the Audit & Risk
Committee on 20 August 2020. Nora is currently a Non-Executive Director of Westpac Banking
Corporation and Origin Energy. She is an experienced company director with 30 years’ experience as
a Non-Executive Chair and Director of companies in a wide range of industry sectors, including the
public, government and private sectors. A former banking executive, Nora has extensive financial and
risk management expertise, including having chaired the audit and risk committees of a number of
listed companies. She is a published author, has worked as an Associate Professor in the Melbourne
Business School at Melbourne University and is a former member of the Takeovers Panel. She was
awarded a centenary medal for services to Australian society in business leadership. Nora holds a
Doctor of Philosophy and a Bachelor of Law (Hons) from the University of Melbourne and is a
Fellow of the Australian Institute of Company Directors.
Board & Executive Leadership TeamBoard & Executive Leadership Team42 43
Board & Executive Leadership Team – continued
Executive Leadership Team
Graham Chipchase Chief Executive Officer
Chair of the Executive Leadership Team
(See biography on page 41.)
Phillip Austin President, CHEP Asia-Pacific & CHEP India, Middle East, Türkiye and Africa
Joined Brambles in 1989 and became President CHEP Asia-Pacific in October 2014 and from July 2021
he became President CHEP IMETA (India, Middle East, Türkiye and Africa). Phillip previously held the
positions of President CHEP Australia and New Zealand, and President CHEP Australia. He has held a
variety of senior roles across Brambles, including CFO of the Brambles Transport Group, CFO of
CHEP Australia, Operations Manager for Wreckair Hire and executive roles in the CHEP Australia
business responsible for sales, asset management and business development. Phillip is an
Ambassador for the National Association for Women in Operations (NAWO). He holds a Bachelor of
Economics and a Master of Logistics Management, both from the University of Sydney, and is a
graduate of the Australian Institute of Company Directors.
Patrick Bradley Chief People Officer
Joined Brambles in 2018 as Group Senior Vice President, Human Resources. Before joining Brambles,
Patrick was the Human Resources Director at BT Group, the UK’s largest fixed communications
network, responsible globally for employee relations, reward, pensions, organisational design and
efficiency. Prior to that, he was the Chief Human Resources Officer at EE, the UK mobile
telecommunications operator, when it was acquired by BT. He has also held human resources
leadership roles at Lloyds Banking Group and Atos Origin. He has led multiple workforce and human
resources programmes to improve customer service capabilities, organisational culture and employee
engagement. He holds a Bachelor of Law from the University of Leeds.
David Cuenca President, CHEP Europe
Joined Brambles in 2000 and was appointed President, CHEP Europe in 2020. At Brambles, David has
held several leadership roles, ranging from Country General Manager of CHEP in Central Europe,
Vice President and Country General Manager in CHEP Spain and Portugal, Vice President of
CHEP Southern Europe, President, CHEP Latin America. David holds a Business Studies degree from
the University of Barcelona. He has also completed a General Management Programme at the
IESE Business School.
Paola Floris President, CHEP Latin America
Joined Brambles in 2001 and was appointed President, CHEP Latin America on 1 July 2020. During her
time at Brambles, Paola has held several leadership roles, ranging from Customer Service Director,
CHEP Italy and progressed to become Retail Director in 2009. Paola was appointed as
Country General Manager, CHEP Italy in 2013 and was promoted to Vice President and
Country General Manager, CHEP Pallets Canada in 2016. Paola has a degree in Economics from the
Università Cattolica del Sacro Cuore, and a Master of Business Administration from SDA Bocconi.
Board & Executive Leadership Team – continued
Enrique Montanes Garcia Chief Operations Officer
Joined Brambles in 2003 and was appointed Chief Operations Officer for CHEP’s global operations on
1 October 2021. Enrique previously held the position of Senior Vice President CHEP Southern Europe
(which includes Spain, Morocco, Italy, Portugal, Greece and France) from July 2018 and prior to that
held a variety of senior roles across Brambles in planning, operations and transportation. Before
j
oining Brambles, Enrique was a consultant with Accenture and held a number of manufacturing roles
with Lucent Technologies. He holds a double Engineering degree from Universidad Politécnica de
Madrid and the École Centrale de Paris and an executive MBA from Instituto de Empresa of Madrid.
Robert Gerrard Chief Legal Officer & Company Secretary
Joined Brambles in 2003 as Senior Counsel, Brambles Group. He was appointed Group Company
Secretary in February 2008 and Group Vice President, Legal and Secretariat in February 2017. Prior to
j
oining Brambles, Robert was General Counsel and Company Secretary of Roc Oil Company Limited;
Group Legal Manager of Cairn Energy plc; General Counsel and Company Secretary of Command
Petroleum Limited; and a solicitor and senior associate with Allen Allen & Hemsley. He holds a Master
of Law from the University of Sydney, and a Bachelor of Science and a Bachelor of Law from the
University of New South Wales. He is a Solicitor of the Supreme Court of New South Wales. Robert
will retire as Chief Legal Officer on 14 October 2023.
Craig Jones Chief Transformation Officer
Joined Brambles in December 2017. He was appointed Chief Transformation Officer in July 2021 to
deliver on our transformation opportunities – build a culture and the capability to support continuous
business improvement. Craig previously held the positions of Vice President, EMEA Emerging Markets
and President CHEP IMETA (India, Middle East, Türkiye and Africa). Before joining Brambles,
Craig worked for Rexam plc, a UK-listed consumer packaging company. Craig led the Africa,
Middle East & Asia region for Rexam and also spent time leading their Russian business. Craig joined
Rexam in 2001 and held a number of senior finance roles across a variety of geographies. Craig holds
a BA (Hons) Business Studies from Cardiff University and is a Fellow (FCMA) of the Chartered Institute
of Management Accountants.
Helen Lane Chief Digital Officer
Joined Brambles in 2003. She was appointed Chief Data and Digital Officer on 1 July 2021. During her
time at Brambles, Helen has held several leadership roles in business functions including Finance,
Commercial, Logistics, Asset Productivity and Retail. Helen was appointed Vice President, CHEP
Northern Europe in December 2016. Since 2019 she has led the digital transformation of Brambles to
increase asset capabilities and drive value for our customers. Helen holds a BA (Hons) English and
French from University of Leeds. She is also a graduate of the INSEAD Business School.
Laura Nador President, CHEP North America
Joined Brambles in 2003. Laura became President, CHEP North America in January 2018, after holding
a number of leadership positions within Brambles across multiple geographies. Laura was successively
Director, Distributor Sales, CHEP Europe; Vice President, RPCs, Europe; Country General Manager,
CHEP Spain and Portugal; and Vice President, Supply Chain, CHEP Latin America. In July 2016,
she was appointed Senior Vice President of the CHEP USA Pooled Pallets business and then
President, CHEP USA in March 2017, when she took on additional responsibilities for all pallets and
containers businesses in the USA. CHEP Canada was added to her responsibilities in January 2018.
Prior to Brambles, Laura worked for a number of years at the Fortune 500 logistics company, Ryder.
Laura holds a Master of Engineering from the University of Buenos Aires and a Master of Business
Administration from the London Business School.
Board & Executive Leadership TeamBoard & Executive Leadership Team44 45
Board & Executive Leadership Team – continued
Nessa O'Sullivan Chief Financial Officer
(See biography on page 42.)
Sarah Pellegrini Chief Communications Officer
Joined Brambles in 2018 to lead Group-wide internal communications and was appointed to the
Executive Leadership Team in 2019. Before joining Brambles, Sarah oversaw employee
communications for Qantas’ global operations, and has held corporate communications roles in
international businesses including Arrium and Foster’s Group in Australia and Rexam plc, SABMiller
and BBC Worldwide in the UK. Sarah began her career as a journalist for News Limited after gaining a
Bachelor of Arts (Journalism) from RMIT University.
Harry Winstanley Chief Information Officer
Joined Brambles in December 2022 as Chief Information Officer. Prior to Brambles, Harry led the
Information Technology function for complex global organisations, including
Chief Information Officer at Meggitt PLC, a leading international company specialising in
high-performance components and sub-systems for the aerospace, defence, and energy markets; and
Unipart Group, a multinational logistics, supply chain manufacturing and consultancy company.
Before that, he held senior leadership positions for Volvo Construction Equipment in Information
Technology, Process and Systems, Distribution Development and as Regional
Chief Information Officer.
Directors’ Report – Remuneration Report
Executive Summary
The Remuneration Report outlines the remuneration for Brambles’ Key Management Personnel (KMP) for the financial year
ended 30 June 2023 (the Year). It should be read in conjunction with the information provided on Brambles' results and
continued execution of Brambles' business strategy, as detailed in the Operating & Financial Review on pages 6 to 39.
Annual Short-Term Incentive
Based on performance against the corporate and personal objectives set for the Year, the annual Short-Term Incentive (STI) for
Executive KMP (see Section 1) ranged from 135% to 143% of Target. Half of the STI is paid as STI share awards deferred for two
years from grant date. These STI outcomes were driven by Brambles’ financial performance, each Executive KMP’s achievement
of specific personal objectives and after consideration of their adherence to the Brambles Code of Conduct, shared values and
risk appetite.
Long-Term Incentive
The Long-Term Incentive (LTI) share awards granted during October 2020 (i.e. in FY21) had a three-year performance period
ending 30 June 2023. Performance against the vesting conditions to which they were subject is:
- Brambles’ total shareholder return (TSR) was ranked at 57 out of the ASX100 peer group, resulting in 0% vesting for this
component (25% of LTI grant), and ranked at 69 out of the MSCI peer group, resulting in 0% vesting for this component
(25% of LTI grant); and
- Brambles' sales revenue CAGR was 9.7% and Return on Capital Invested (ROCI) was 17.8%, resulting in 100.0% vesting for
this component (50% of LTI grant).
Accordingly, 50% of total LTI awards granted in FY21 vested. Details of LTI vesting are provided in Section 4.3.2.
Executive Leadership Team (ELT) Base Salaries and Non-Executive Director Fees
The base salaries of the Executive KMPs and other members of the ELT were determined in accordance with the Company's
Remuneration Strategy described in Section 2.
The shift towards more digital and automation roles, in line with Brambles' strategic plan, coupled with continued high inflation
in many of Brambles' operating countries, led the Remuneration Committee to review the Group's data sources for market
benchmarking across its regions. Brambles now uses three market-leading providers of salary data to determine fair
compensation for roles, as well as giving it additional data related to executive pay. Base salaries are reviewed in June of each
year and take effect from 1 July the following financial year.
Brambles has senior executives located in different geographies and their remuneration is a blend of local and Australian
practice. Following the Year's remuneration strategy review, effective from 1 July 2023, it was decided to make an adjustment
to executives' remuneration in line with observed benchmarking. Long-term incentives were under-represented as a
component of the executive team’s reward package. The Remuneration Committee decided to increase the LTI opportunity
by 25 percentage points for ELT team members, and not increase their base salary for a period of two years. This will
create a reward structure that moves executive remuneration into greater alignment with current benchmarking. Any new
members of the executive team will enter under the new structure, and ELT base salaries will, after that two-year period,
continue to be reviewed in accordance with Brambles' standard methodology for all roles. More detail is given in section 2.1.
Nessa O'Sullivan is retiring during FY24 and received a base salary increase instead of receiving an LTI grant
during FY24. Executive KMP salaries for FY23 are set out in Section 5.
There have been no movements in the Chair and Non-Executive Director base fees since 1 July 2016. This Year however, to
keep fees in line with market median, we have increased the Chair’s fees by 3.7% and similarly applied a 3.8% increase in base
fees for Non-Executive Directors for FY24. Non-Executive Director fees are detailed in Section 7.1.
Remuneration Strategy
The Remuneration Committee carries out annual reviews of Brambles’ remuneration strategy, including share-based incentive
plans. These reviews are to ensure the Company's remuneration structure and policy continue to align with the Company's
strategic and business objectives, and that its incentive plans do not reward conduct that is contrary to Brambles' Code of
Conduct, shared values and risk appetite (Non-Financial Risks).
Contents
1. Background
2. Remuneration Policy and Framework
3. Remuneration Structure
4. Performance of Brambles and Remuneration Outcomes
5. Executive Key Management Personnel (Executive KMP)
6. Employee Share Plan
7. Non-Executive Directors’ Disclosures
8. Remuneration Governance
9. Other Reporting Requirements
Directors’ Report – Remuneration Report 47Board & Executive Leadership Team46
Directors’ Report – Remuneration Report – continued
Background
This Remuneration Report provides information on Brambles’ Remuneration Policy and the link between that policy and the
Group's business strategy, financial performance and conduct consistent with Brambles’ Code of Conduct, shared values and risk
appetite. This report also provides remuneration information about Brambles’ Key Management Personnel (KMP), who are its:
- Non-Executive Directors as set out in Section 7; and
- Executive Directors and Group Executives who have authority and responsibility for planning, directing and controlling the
Group’s activities (Executive KMP). The executives who fall within this definition are those set out in Section 5.
In this report, references to the ELT include Executive KMP.
This report includes all disclosures required by the Corporations Act 2001 (the Act), regulations made under the Act and the
Australian Accounting Standard AASB 124 Related Party Disclosures. The disclosures required by Section 300A of the Act have been
audited. Disclosures required by the Act cover both Brambles Limited (Company) and the Group.
Remuneration Policy and Framework
Brambles’ Remuneration Policy, approved by the Board, is to adopt a remuneration structure and set remuneration levels which:
- enables Brambles to attract, retain and motivate high-calibre executives and other talent throughout the Group;
- fairly and responsibly rewards executives with regard to Brambles’ performance, the performance of executives and the general
remuneration environment;
- aligns:
- executive reward with the creation of sustainable shareholder value; and
- executive behaviour with Brambles’ strategic objectives, Code of Conduct, shared values and risk appetite.
Section 3.1 summarises Brambles’ Remuneration Policy and Section 3.3 sets out how remuneration is directly linked to the
Company’s financial performance, the creation of shareholder value, the delivery of strategic objectives and executive behaviour.
This link is achieved through Brambles' short and long-term incentive plans and the assessment by the Board Remuneration
Committee (Remuneration Committee) of the behaviours of executives for Non-Financial Risks during the applicable year.
Corporate and personal short-term incentive objectives are agreed at the start of the financial year and approved by the
Remuneration Committee. The Remuneration Committee reviews progress during the financial year and, at year end, assesses each
executive's performance against both those objectives following a detailed review of Group and business unit performance and
Non-Financial Risk behaviours. Long-term incentive performance conditions are set out in the rules of the Brambles Performance
Share Plan (PSP).
The Group’s Remuneration Policy is to set target remuneration opportunity around the median level of a comparator group of
companies but with upper-quartile total potential rewards for outstanding performance and proven capability. For ELT roles, the
Remuneration Committee performs annual global remuneration benchmarking reviews against that comparator group to ensure
that Brambles maintains its ability to attract and retain the right talent.
Brambles’ global remuneration framework, which applies to all salaried employees, is underpinned by its banding structure. This
classifies roles into specific bands, each incorporating roles with broadly equivalent work value. Pay ranges for each band are
determined under the same framework globally and are based on the local market rates for the roles falling within each band.
One of Brambles' Human Resources Department's key strategic projects for the Year relates to Brambles' remuneration and grading
structure and policies. This project incorporates remuneration transparency and equity and will enable Brambles' banding structure
to continue to support its organisation structure and strategy.
2.1 Remuneration Strategy Review
The Remuneration Committee carries out annual reviews of Brambles’ remuneration strategy, including share-based incentive
plans. These reviews are undertaken to determine whether the current approach continues to strongly align executives' interests
with those of the Company and its shareholders. The focus of the annual review is to provide confirmation that the
Company's remuneration structure and policies advance the Company's strategic and business objectives, as well as Brambles'
Code of Conduct, shared values, and risk appetite (Non-Financial Risks).
The Remuneration Committee carried out its annual review during the Year and decided, after a review of appropriate benchmarks,
that from 1 July 2023, the following changes should be made to the 'At Risk' components (see Section 3.1) of executive
remuneration:
- to enable the STI plan to better reflect the key value drivers emerging from Brambles' transformation programme, executives
will now have the 30% component of their STI that was previously allocated to 'personal scorecard objectives' allocated to
Customer Satisfaction and Asset Efficiency metrics; and
- to better align with current benchmarking on the proportion of total remuneration opportunities, the LTI should assume a
higher weighting of executives' total remuneration opportunity. It has therefore been increased by 25 percentage points. To
offset this LTI increase, it was decided to implement a base salary freeze for ELT members for a period of two years.
In addition, to more explicitly capture other important dimensions of executive performance, all ELT members will have a
performance modifier applied to their STI outcome which incorporates Brambles’ performance against certain published
sustainability targets, its health and safety performance, as well as individual performance against the behaviours in Brambles’
Directors’ Report – Remuneration Report – continued
leadership framework. This modifier can increase or decrease an executive's STI outcome, but the maximum STI outcome for each
executive remains unchanged. Application of the modifier will be reviewed and approved by the Remuneration Committee.
Further details on the elements of the modifier are as follows:
- Sustainability targets: this will measure performance against the following four components of the Green Bond issued by
Brambles on 22 March 2023: timber certification; GHG emissions; gender diversity in management positions; and zero product
waste to landfill;
- Health and safety targets: this will measure performance against the BIFR metric, which measures work-related incidents
resulting in fatalities, lost time, modified duty or medical treatment per million hours worked; and
- Brambles’ leadership framework: this will assess an executive's performance against four leadership framework behaviours:
cares for our customers; disrupts our business model; delivers for Brambles; and inspires our people.
The STI weighting on Brambles' Underlying Profit (40%) and Cash Flow from Operations (30%) will remain unchanged for FY24.
Remuneration Structure
3.1 Overview
Remuneration is divided into those components not directly linked to performance (Fixed Remuneration) and those components
which are variable and directly linked to Brambles’ financial performance and the delivery of corporate and personal objectives
(At Risk Remuneration). The diagram below summarises the remuneration structure for Executive KMP for the Year.
Year 1 Year 2 Year 3 Year 4
Legend: Cash awarded Share Awards granted Share Awards vested Share Awards unrestricted.
Payments are made and awards are granted following the end of the financial year and finalisation of Brambles’ results.
An individual’s At Risk Remuneration is subject to the overarching discretion of the Board and the Remuneration Committee in
relation to Non-Financial Risks. That discretion is informed by how individuals achieve results and the extent to which they
exemplify the behaviours expected of them as leaders of the Company as set out in Brambles’ Code of Conduct, shared values and
risk appetite.
STI and LTI share awards are governed by the PSP rules, which have been approved by shareholders. No Brambles shares were
purchased on-market during the Year to satisfy the entitlements of holders of STI share awards or LTI share awards.
The remuneration structure and the key features of Fixed and At Risk Remuneration are summarised in Section 3.3.1. The
application of the At Risk Remuneration is further described in Section 4.
3.2 Basis of Valuation of STI and LTI Share Awards
Details of the approach are contained in Section 9.4.
Holding lock
(
1 year
)
50% Cash paid
Fixed Remuneration
Base salary,
superannuation and
other benefits
Cash
Paid through the Year
STI Award
(At Risk)
Maximum opportunity
150% to 180% of base
salary
Cash and Shares
1-year performance
period
70% Financial
objectives
30% Personal objectives
LTI Share Award
(At Risk)
Maximum opportunity
100% to 130% of base
salary
Share Awards
50% Relative Total Shareholder Return
(25% based on Brambles
’
TSR against the ASX 100 constituents and
25% based on Brambles’ TSR against the MSCI World Industrials constituents,
using 50 companies either side of Brambles’ rolling 12-month average
market capitalisation)
50% Sales Revenue CAGR/ROCI matrix
50% Share Awards
Deferred 2 years from grant
Directors’ Report – Remuneration ReportDirectors’ Report – Remuneration Report48 49
Directors’ Report – Remuneration Report – continued
3.3 Remuneration Structure Details
The Company's remuneration structure is detailed below.
3.3.1: Remuneration Structure FY23
Remuneration
element Description Purpose Link to strategy
Fixed Remuneration
Base salary, superannuation, and
other fixed benefits.
Fixed remuneration reflects the
executive’s role, duties, responsibilities,
and level of performance, taking into
account the individual's location and
Brambles' size, geographic scale and
complexity. Base salaries are generally
referenced at the market median.
Base salaries are designed to be
competitive to assist Brambles
in attracting and retaining
talented executives.
At Risk Remuneration
STI Award
Executive KMP are eligible to receive annual STI awards. The Remuneration Committee approves annual STI financial and personal
objectives for Executive KMP. At the end of each year, the Remuneration Committee assesses Executive KMPs’ performance against
those objectives. The amount of an STI Award will depend on whether and, if so, to what extent those objectives are achieved.
Half of the STI award is delivered in cash following the end of the year to which the award relates. The other half is delivered in deferred
STI Share awards which vest two years from the date they are granted, subject to the relevant Executive KMP remaining employed by
the Group at the end of that period. Eligibility for STI awards is also subject to the Remuneration Committee's discretion, described
below, on Financial and Non-Financial Risks, both at the time of the grant of the awards and during the two-year deferral period.
The achievement of objectives by Executive KMP for FY23 are set out in Section 4.2.
Financial
objectives
(comprising 70%
of the STI award)
Financial objectives are set at a
Threshold (the minimum
necessary to qualify for the
awards), Target (when the
performance target is met) and
Maximum (when targets have
been significantly exceeded and
the award has reached its upper
limit) level. For Underlying Profit,
Threshold levels are set at or
above the prior year's outcome
for the relevant objective,
except where extenuating
circumstances exist.
Financial objectives are set to align an
executive’s At Risk Remuneration to
Brambles’ financial and strategic
objectives. For FY23, these were: Business
Unit and Group Underlying Profit,
Cash flow sufficient to fully fund capital
expenditure and dividends, and
operational efficiency.
Financial objectives are chosen to link
Executive KMPs’ rewards with the financial
performance of the Group, the pursuit of
profitable growth, the efficient use of
capital and generation of cash.
FY23 financial objectives:
- Underlying Profit
provides a focus on
profitable growth that links
to Brambles' strategy of
delivering Underlying
Profit growth in excess of
sales revenue growth
through the cycle; and
- Cash Flow from Operations
is used as a measure
to provide a strong
focus on the generation
of cash, which links to
Brambles' strategy of
generating Free Cash Flow
sufficient to fully fund
capital expenditure and
dividends.
Personal
objectives
(comprising 30%
of the STI award)
Personal objectives relate to a mix
of performance conditions aligned
to customer, productivity,
transformation and people.
Personal objectives provide the
opportunity to tailor individual Executive
KMP performance expectations, having
regard to their role and function, to
specific non-financial operating and
strategic goals.
Personal objectives are linked
to the delivery of Brambles’
strategic and operating
priorities, such as:
- Asset Efficiency;
- Safety;
- Customer Satisfaction; and
- Transformation goals.
Directors’ Report – Remuneration Report – continued
Remuneration
element Description Purpose Link to strategy
LTI Share Award
Executive KMP are also eligible to receive an annual grant of LTI share awards vesting three years from the date the award is granted,
subject to satisfaction of service and performance conditions. A one-year holding lock post-vesting applies to awards granted from
FY20 onwards, during which executives cannot sell vested LTI awards other than to pay any tax obligations arising from awards vesting
or the exercise of vested awards. Eligibility for LTI awards is also subject to the Non-Financial Risks assessment referred to below, both
at the time of the grant of the awards and during their three-year performance period (Performance Period). The number of LTI share
awards to which an Executive KMP is entitled is an amount, calculated using the face value approach, equal to a specified proportion of
their base salary as shown in Section 4.3.
Relative TSR
(comprising half
of the LTI Share
award)
Performance is measured over a
three-year performance period
against constituents of both the
ASX100 and the MSCI World
Industrials indices,
using 50
companies either side of
Brambles’ rolling 12-month
average market capitalisation.
Each component is measured
separately and comprises 25% of
the total LTI Award.
The vesting schedule for the
portion of the LTI subject to TSR is
outlined below.
TSR
percentile
% Vesting
of shares
Below
Threshold
Below
50th
No vesting
Threshold 50th 50%
Between
Threshold
and
Maximum
Between
50th and
75th
Pro-rata
straight-
line vesting
Maximum 75th and
above
100%
Relative TSR rewards the creation of
shareholder value.
TSR measures the returns that a company
has provided for its shareholders,
reflecting share price movements and
reinvestment of dividends over a specific
period.
A relative TSR performance condition
means that value is only delivered to
participants if the investment return
received by Brambles’ shareholders is
sufficiently high relative to the return they
could have received by investing in a
portfolio of alternative stocks over the
same period.
TSR provides a direct alignment
of executive rewards to the
creation of shareholder value
through linking executive
reward with the long-term
generation of returns to
Brambles’ shareholders.
Sales revenue
CAGR and ROCI
(comprising half
of the LTI Share
Award)
Each year, a sales revenue
CAGR/ROCI matrix is set by the
Remuneration Committee for each
LTI share award, based on targets
approved by the Board. This
allows the Remuneration
Committee to set targets for each
LTI share award that reward
superior performance in light of
the prevailing and forecast
economic and trading conditions.
The FY24–FY26 sales revenue
CAGR/ROCI matrix, pertaining to
the LTI share awards to be granted
in October 2023, is set out in
Section 4.3. The sales revenue
CAGR/ROCI targets have been
established based on the Group's
three-year strategic plan.
This portion of the LTI share award
incentivises both long-term sales revenue
growth and ROCI. Vesting is based on
achievement of sales revenue targets with
three-year performance targets set on a
CAGR basis. The sales revenue growth
targets are underpinned by ROCI hurdles.
Sales revenue CAGR is measured in
constant currency.
The sales revenue CAGR/ROCI
matrix is designed to drive
profitable business growth, to
maintain quality of earnings
and to deliver a strong ROCI.
This links to Brambles' strategy
of delivering long-term value
creation and sustainable
shareholder returns.
Directors’ Report – Remuneration ReportDirectors’ Report – Remuneration Report50 51
Directors’ Report – Remuneration Report – continued
Minimum
shareholding
requirements Description
Brambles
requires ELT
members to hold
a meaningful
stake in the
Company to
assist in aligning
their interests
with those of its
shareholders.
The minimum shareholding requirement (MSR) is to acquire and maintain Brambles' shares to be built up over five
years. From 1 July 2023 the CEO has agreed to increase their MSR to 300% of base salary and for the other ELT
members their MSR will increase to 125% of their respective base salaries to reflect the LTI uplift. Each year, the
Remuneration Committee receives a report on the progress towards the attainment of the required MSR.
While building their MSR, ELT members are not permitted to sell Brambles shares, other than to pay tax obligations
they incur by reason of STI or LTI share awards vesting (or upon exercise of vested awards), until they have
achieved 100% of their shareholding requirements. Thereafter, they are required to maintain their respective MSR.
Where Executive Directors step down from their Executive Director position but continue to be employed by the
Company, they will, under the Company's Securities Trading Policy, need the Chair’s approval to sell or otherwise
deal in Brambles' shares.
Executive Directors who cease to be employees of the Company are required to retain at least 50% of their
minimum shareholding for the 12 months following their cessation of employment.
Clawback of
awards Description
Clawback
provisions
operate in
relation to STI
and LTI share
awards
Under the PSP rules, the Board has discretion to reduce, cancel or lapse unvested or vested STI or LTI share awards
in the circumstances set out in the PSP rules (a copy of the rules is on the Employee Share Plans page of the
Corporate Governance section of the Brambles website). These circumstances are included to protect the financial
soundness of the Group from an exceptional event which has a material impact on the value of the Group, a
material inaccuracy in the assessment of the performance of a participant in the PSP (including an Executive KMP)
or any subsequent or adverse development regarding the personal performance of such a participant.
Non-Financial
Risks:
Remuneration
Committee
discretion Description
Remuneration
Committee
discretion
regarding
'At Risk'
Remuneration
The Remuneration Committee has discretion to adjust the level of 'At Risk' Remuneration (both STI and LTI awards),
which can be used to increase or decrease vesting outcomes, including reducing vesting to zero. The Remuneration
Committee assesses a broad range of factors, not typically captured in STI and LTI metrics, in considering whether
to exercise discretion. These can include a broader assessment of financial performance, the share price
performance of the Company and the behaviours exhibited by individual ELT members in relation to Non-Financial
Risks (which includes their adherence to the Brambles' Code of Conduct, shared values and risk appetite).
The Remuneration Committee adopted a principles-based approach to Non-Financial Risks, with a framework that
provides guidelines as to the types of events that may warrant an adjustment and guidance on what should be
considered by the Remuneration Committee. Advice is provided to the Remuneration Committee by the Chair of
the Audit & Risk Committee, the CEO, the Chief People Officer, the Chief Legal Officer & Company Secretary, and
the Group Vice President of Risk, Internal Audit & Insurance on any major or severe incidents to be considered by
the Remuneration Committee when deciding whether to exercise its discretion to adjust any year end remuneration
outcomes.
Directors’ Report – Remuneration Report – continued
3.4 Remuneration Structure and Mix for Executive KMP
Brambles’ Executive KMP remuneration mix is linked to performance. At Risk Remuneration represents 71% to 76% of
Executive KMP maximum remuneration package.
3.4.1 FY23 STI Plan Structure and Performance
As detailed in Section 3.3.1, the FY23 STI Plan comprises Financial Objectives and Personal Objectives, all components of which are
assessed against their respective performance targets to provide an overall assessment.
Objective
Weighting
at Target
Payment schedule
Business Unit Underlying Profit
(for President Europe and President North America)
20%
10% at Threshold; 20% at Target; 30% at Maximum, with a
sliding scale in between.
Group Underlying Profit
(40% for CEO/CFO)
20%
10% at Threshold; 20% at Target; 30% at Maximum, with a
sliding scale in between.
Business Unit Cash Flow from Operations
(for President Europe and President North America)
15%
7.5% at Threshold; 15% at Target; 22.5% at Maximum, with a
sliding scale in between.
Group Cash Flow from Operations
(30% for CEO/CFO)
15%
7.5% at Threshold; 15% at Target; 22.5% at Maximum, with a
sliding scale in between.
Personal Objectives 30%
15% at Threshold; 30% at Target; 45% at Maximum, with a
sliding scale in between.
The CEO's Personal Objectives are individually assessed by the
Board Chair, reviewed by the Remuneration Committee and
approved by the Board. Personal Objectives of the other
Executive KMP (and all ELT members) are reviewed and
approved by the Remuneration Committee.
3.4.2 Remuneration Mix
The table below illustrates the remuneration potential for the Executive KMP showing Target and Maximum potential as a
percentage of base salary.
Remuneration Mix
CEO/CFO
Target Potential
CEO/CFO
Maximum Potential
President NA/Europe
Target Potential
President NA/Europe
Maximum Potential
Base Salary 100% 100% 100% 100%
STI Cash Award 60% 90% 50% 75%
STI Share Award 60% 90% 50% 75%
LTI Share Award 65%
1
130% 50% 100%
Total 285% 410% 250% 350%
The table below shows the balance between Cash and Equity at Target and Maximum for Executive KMP.
Remuneration Mix as a %
of Total Remuneration
CEO/CFO
Target Potential
CEO/CFO
Maximum Potential
President NA/Europe
Target Potential
President NA/Europe
Maximum Potential
Cash Potential 56% 46% 60% 50%
Equity Potential 44% 54% 40% 50%
Total 100% 100% 100% 100%
1
The target % of the LTI Share Award represents a nominal 50% achievement of the component elements related to CAGR/ROCI and TSR performance.
Directors’ Report – Remuneration ReportDirectors’ Report – Remuneration Report52 53
Directors’ Report – Remuneration Report – continued
3.5 Brambles’ Five-Year Performance and Remuneration Outcomes
The table below sets out the dividends paid, Brambles' share price at the beginning and the end of the financial year, the financial
performance conditions for the STI and LTI share awards, and the Company’s performance for continuing operations for the period
FY19 to FY23 and the STI and LTI award outcomes for those years. The table below shows the following:
- financial measures relating to CHEP China are excluded from FY23 and FY22 following its divestment, however it is included in
FY19 to FY21;
- Underlying Profit for FY21 has been restated for the change in accounting policy relating to Software as a Service
arrangements. Periods prior to FY21 have not been restated for the impact of this change in accounting policy;
- the periods prior to FY20 have not been restated for the impact of new accounting standard AASB 16 Leases; and
- Underlying Profit and Cash Flow from Operations are presented at actual foreign exchange rates consistent with the amounts
in the consolidated financial statements for the applicable year.
Definitions for the financial metrics are provided in the Glossary on pages 141 to 143.
The numbers shown below reflect Brambles’ financial statements for the applicable year as well as STI and LTI outcomes as
reported in those years.
FY23 FY22 FY21 FY20 FY19
Dividends (cents per share)
2
US$0.2625 US$0.2275 US$0.205 US$0.18 A$0.29
Share price (A$): at 1 July 11.05 11.30 10.89 12.75 8.88
Share price (A$): at 30 June 14.41 10.71 11.44 10.87 12.88
STI financial measures (US$m)
Underlying Profit
3
1,067.0 930.0 874.6 799.4 803.7
Cash Flow from Operations
4
789.8 391.8 901.1 754.8 431.8
STI outcome range
for Executive KMP (% base salary)
5
135%-171% 78%–135% 108%–136% 62%–112% 48%–120%
STI outcome range for Executive KMP
(% of Target)
135%-143% 78%–132% 107%–116% 62%–112% 48%–99%
LTI measures
Sales Revenue (US$m) 6,076.8 5,519.8 5,209.8 4,717.9 4,595.3
ROCI 19% 18% 18% 17% 19%
Cumulative three-year TSR growth 37.11% -4.87% 26.36% 21.41% 6.94%
LTI outcome (% of grant)
6
50% 50% 64% 89% 0%
2
Effective from 2020, Brambles changed to a payout ratio-based dividend policy, with the dividend per share declared in US cents and converted and paid in
Australian cents. Prior to 2020, dividends were declared and paid in Australian cents. The Australian dollar equivalent of the FY23 dividend of US$0.2625 per share is
A$0.3950 per share. The Australian dollar equivalent of the FY22 dividend of US$0.2275 per share is A$0.3231 per share. The Australian dollar equivalent of the
FY21 dividend of US$0.205 per share is A$0.27 per share. The Australian dollar equivalent of the FY20 dividend of US$0.18 per share is A$0.26 per share.
3
Underlying Profit relating to CHEP China are excluded from FY23 and FY22 following its divestment, however it is included in FY19 to FY21.
4
Cash Flow from Operations is a non-statutory measure (refer Note 2 of the Consolidated Financial Report).
5
The range of outcomes for Executive KMP includes financial and personal objectives for STI cash and STI share awards. The STI share awards are deferred for two years
from grant date.
6
LTI outcome is for the Performance Period ending in the relevant year. For example, the FY23 LTI outcome relates to the FY21 to FY23 Performance Period.
Directors’ Report – Remuneration Report – continued
Performance of Brambles and Remuneration Outcomes
4.1 FY23 STI Awards
The following table summarises the components and weighting of objectives for the FY23 STI awards for Executive KMP:
Executive KMP
Financial Objectives
Personal
Objectives
Group
Underlying Profit
Business Unit
Underlying
Profit
Group
Cash Flow from
Operations
Business Unit
Cash Flow from
Operations
CEO, CFO 40% - 30% - 30%
Presidents
North America / Europe
20% 20% 15% 15% 30%
Executive KMP personal objectives for FY23 are shown in Section 4.2. Recommended targets for global metrics relating to business
strategy and growth objectives are set at the Group level and reviewed and approved by the Remuneration Committee. Objectives
are set for each Executive KMP, which support and are aligned with the achievement of Brambles' overall business strategy and
business unit objectives.
FY23 objectives included: customer; productivity; transformation strategy; and people. Quantitative metrics for achievement of each
of these objectives are set, which allows the Remuneration Committee to determine objectively whether they have been met. For
customer, this was a specified percentage increase in net promoter scores (a metric used to measure customer satisfaction). For
productivity, this was a specified improvement in the applicable pooling capital expenditure to sales ratio. For people, this was a
specified percentage improvement in the BIFR. For transformation strategy, this was the achievement of specified FY23 milestones
in the Shaping Our Future transformation programme.
4.2 FY23 STI Group Financial Objectives Outcomes
The following table outlines performance against Brambles' FY23 STI Group Financial Objectives against the targets shown.
Brambles' Group Financial Objectives
Metric Performance Outcome
Group Underlying Profit
Underlying Profit increased 19% at constant currency as
contributions from pricing actions offset cost-to-serve increases
including input-cost inflation, lost equipment charges and
incremental overhead investments to support growth and the
delivery of transformation programme benefits.
Above Maximum
Cash Flow from Operations Cash Flow from Operations performance reflects higher earnings
and favourable working capital movements partly offset by higher
cash capital expenditure in the period
Above Maximum
Brambles' Group Personal Objectives Metrics for Executive KMP
Executive KMP Customer Productivity Transformation People
CEO
Group
Customer NPS
5%
Group
Asset Productivity
10%
Group
Transformation Goals
10%
Group
BIFR
5%
CFO
Group
Customer NPS
5%
Group
Asset Productivity
12.5%
Group
Transformation Goals
12.5%
President
North America
North America
Customer NPS
7.5%
North America
Asset Productivity
7.5%
North America
Transformation Goals
7.5%
North America
BIFR
7.5%
President
Europe
Europe
Customer NPS
7.5%
Europe
Asset Productivity
7.5%
Europe
Transformation Goals
5%
Europe BIFR and
Engagement survey
10%
The Remuneration Committee assessed the outcome of these objectives by reference to the quantitative metrics outlined above for
their achievement set at the beginning of the Year. The outcome of that assessment is shown on page 56.
Directors’ Report – Remuneration ReportDirectors’ Report – Remuneration Report54 55
Directors’ Report – Remuneration Report – continued
CEO and CFO FY23 STI Performance
The FY23 STI outcomes for the CEO and CFO are shown below based on performance against their STI objectives. As indicated
earlier in this report, half of the STI award is delivered in deferred STI share awards, which vest two years from the date of grant,
subject to the applicable Executive remaining employed by the Group at the end of that period.
In the following table, the outcomes for Underlying Profit and Cash Flow from Operations are based on 30 June 2022 foreign
exchange rates. This allows relative performance between FY22 and FY23 to be assessed so that participants neither benefit or
experience detriment from foreign exchange movements.
Performance Objective Weighting Threshold Target Maximum Outcome
Outcome
as % of
base
salary
Outcome
as % of
target
Underlying Profit (US$)
40% 954.6m
984.1m 1,013.6m
1,092.9m 72% 150%
Cash Flow from Operations
(US$)
30% 427.0m
461.6m 496.3m 779.3m 54% 150%
CEO Personal Objectives 30% 18%
36% 54%
Achieved
between
Target and
Maximum
42% 117%
CEO Total 100% 168% 140%
CFO Personal Objectives 30% 18%
36% 54%
Achieved
between
Target and
Maximum
45% 125%
CFO Total 100% 171% 143%
In addition to the Brambles STI metrics shown above relating to Underlying Profit and Cash Flow from Operations, the business unit
targets and their respective personal objective outcomes for the Presidents of North America and Europe, were as follows:
Business Unit Metrics
Business Unit Outcome Achievement vs. Target
President, North America
CHEP North America Underlying Profit Above maximum 105%
CHEP North America Cash Flow from Operations Above maximum 162%
Personal Objectives Between Threshold and Target 99%
President, Europe
CHEP Europe Underlying Profit Between Target and Maximum 103%
CHEP Europe Cash Flow from Operations Above maximum 118%
Personal Objectives Between Target and Maximum 108%
Directors’ Report – Remuneration Report – continued
4.2.1 Actual STI Payable and Forfeited for FY23
Details of the FY23 STI award payable to Executive KMP and the FY23 STI award forfeited, as a percentage of the maximum
potential FY23 STI award in respect of performance during the Year, are shown in the following table. The Remuneration
Committee also undertook the Non-Financial Risk assessment outlined in Section 3.3.1 and, based on that assessment, determined
that no adjustment to the vesting levels for any Executive KMP was required.
Name
Total STI target
% of base salary
Actual STI
payable as %
of base salary
Maximum STI as
% of base salary
Total STI payable
(US$)
% of maximum
STI payable
% of maximum
STI forfeited
G Chipchase 120% 168% 180% 2,546,145 93% 7%
N O’Sullivan 120% 171% 180% 1,451,623 95% 5%
D Cuenca 100% 137% 150% 584,858 91% 9%
L Nador 100% 135% 150% 701,398 90% 10%
4.3 Executive KMP LTI Share Awards
Executive KMP are eligible to receive an annual grant of LTI share awards. The awards are made in October each year. The
performance conditions to which LTI share awards are subject are set out in Section 3.3.1. The number of LTI share awards to which
an Executive KMP is entitled is an amount calculated as follows:
[Base salary in A$ at 1 July] x [LTI % in the table below] divided by
[Share price calculated using the face value approach] = number of LTI Share Awards
Role LTI grant as % of base salary
CEO/CFO 130%
President North America/Europe 100%
4.3.1 Sales Revenue CAGR/ROCI LTI Performance Matrix for FY24-FY26
7
The sales revenue CAGR/ROCI matrix for LTI share awards that will be made in October 2023 for the period FY24-FY26 is set out
below. The sales revenue and ROCI components of the matrix are calculated on a Group basis. The prospective vesting date is in
October 2026. ROCI is defined as Underlying Profit divided by Average Capital Invested.
FY24-26 Sales Revenue CAGR/ROCI LTI Performance Matrix Vesting Schedule
ROCI %
Sales Revenue CAGR
8
16.0% 17.5% 19.0%
5% - 20% 40%
6% 20% 40% 60%
7% 40% 60% 80%
8% 60% 80% 100%
9% 80% 100% 100%
As a policy principle, the Remuneration Committee takes into account major acquisitions, divestments, impairments and Significant
Items during the applicable Performance Period in determining the final outcome of the sales revenue CAGR/ROCI matrix for that
period. Acquisitions or divestments that are not material to the overall outcome are excluded from any performance assessment.
The ROCI outcome is the average ROCI over the Performance Period and is calculated by adding each year's ROCI result and
dividing that sum by three.
The matrix continues to provide an appropriate balance between growth and returns well in excess of the cost of capital.
7
Financial targets set for LTI share awards do not constitute profit forecasts and the Board is conscious that their publication may therefore be misleading. Accordingly,
Brambles does not publish in advance the coming year’s financial targets for LTI awards.
8
Three-year CAGR over base year.
Directors’ Report – Remuneration ReportDirectors’ Report – Remuneration Report56 57
Directors’ Report – Remuneration Report – continued
4.3.2 Performance Testing of LTI Share Awards Under the Performance Share Plan
The Performance Period for LTI awards granted in October 2020 ended on 30 June 2023. The TSR component of these awards was
tested against the TSR performance of Brambles over the Performance Period as determined by an independent consultant. The
calculations of the sales revenue CAGR and ROCI components of these awards are based on the audited financial information and
then tested against the FY21 to FY23 matrix by the Remuneration Committee. The Committee also undertook the Non-Financial
Risks assessment outlined in Section 3.3.1 and, based on that assessment, determined that no adjustment to the vesting levels for
any Executive KMP was required. Based on those assessments, these awards vested as follows:
Performance condition Performance Period Performance condition Vesting level
Relative TSR (ASX100) 1 July 2020 to 30 June 2023 Brambles’ TSR performance against the ASX 100 0%
Relative TSR (MSCI) 1 July 2020 to 30 June 2023 Brambles’ TSR performance against the MSCI Industrials 0%
Sales revenue
CAGR/ROCI
1 July 2020 to 30 June 2023 CAGR: 9.7%
ROCI: 17.8%
100%
Total LTI vesting 1 July 2020 to 30 June 2023 50%
4.4 Executive KMP Remuneration and Benefits for the Year
The purpose of the table below is to enable shareholders to understand the actual remuneration received by Executive KMP. The
table provides a summary of the actual remuneration, before equity, received or receivable by the Executive KMP for the Year,
together with prior year comparatives. Income derived from the vesting of STI and LTI share awards during the Year has been
included below as 'Actual share income'. The value shown is the market value at the time the income became available to the
Executive. These share awards were granted in prior financial years and vested in this financial year.
Statutory disclosures relating to share-based payments expense are shown in Section 9.1. Unvested share awards may result in
'Actual share income' in future years and, if so, the income will be reported in the table below in the Remuneration Report for the
relevant year.
There were no loans or other transactions with any Executive Directors or Executive KMP during the Year.
US$'000 Short-term employee benefits
Post-
employment
benefits Other
Actual
share
income
9
Name Year
Cash
salary /
fees
10
Cash
bonus
Non-
monetary
benefits
11
Super-
annuation
Termination
/ sign-on
payments
/
retirement
benefits
Other
12
Total
before
equity
13
STI / LTI /
MyShare
awards
Total
14
Executive Directors
G Chipchase FY23 1,765 1,273 - - - 34 3,072 1,603 4,675
FY22 1,879 1,037 1 - - 7 2,924 2,245 5,169
N O'Sullivan FY23 998 726 35 - - 2 1,761 914 2,675
FY22 1,063 611 17 - - 1 1,692 1,306 2,998
Other Executive KMP
D Cuenca FY23 428 292 17 56 - 3 796 192 988
FY22 433 167 21 57 - 10 688 550 1,238
L Nador FY23 543 351 2 78 - 21 995 453 1,448
FY22 514 324 1 74 - 20 933 418 1,351
Totals
15
FY23 3,734 2,642 54 134 - 60 6,624 3,162 9,786
FY22 3,889 2,139 40 131 - 38 6,237 4,519 10,756
9
Actual share income column represents the non-statutory vested share income and it is a non-IFRS measure.
10
Cash salary/Fees includes base salary and allowances.
11
Non-monetary benefits include company car benefit and tax support.
12
Other includes health insurance and salary continuance insurance.
13
Total before equity column represents the statutory remuneration excluding share-based payments.
14
The Total column represents the non-statutory remuneration.
15
The year-on-year comparison of remuneration is affected by the movement of 30 June 2023 rates from A$1=US$0.7223, £1=US$1.3264 and €1=US$1.1220 for FY22
to A$1=US$0.6750, £1=US$1.2110 and €1=US$1.0510 for FY23.
Directors’ Report – Remuneration Report – continued
Executive Key Management Personnel
5.1 Executive Key Management Personnel Changes
The following executives comprise the Year’s Executive Key Management Personnel (Executive KMP):
- Graham Chipchase, Executive Director and Chief Executive Officer;
- Nessa O’Sullivan, Executive Director and Chief Financial Officer;
- Laura Nador, President, North America; and
- David Cuenca, President, Europe.
There were no changes to Executive KMP during the Year.
5.2 Service Contracts
Graham Chipchase and Nessa O’Sullivan are on continuing contracts, which may be terminated without cause by the employer
giving 12 months’ notice or by the employee giving six months’ notice, with payments in lieu of notice calculated by reference to
annual base salary. As previously announced to the ASX, Nessa O'Sullivan will be retiring in FY24.
David Cuenca and Laura Nador are on continuing contracts, which may be terminated without cause by the employer giving six
months’ notice or by the employee giving six months’ notice, with payments in lieu of notice calculated by reference to annual
base salary.
These standard service contracts state that any termination payments made would be reduced by any value to be received under
any new employment and are subject to limits imposed under Australian law.
Details of Executive KMP salaries are shown below.
5.2.1 Contract Terms for Executive KMP
Name and role(s) Base salary at 1 July 2022 Base salary at 1 July 2023 Notice period
G Chipchase, CEO GBP 1,251,500 GBP 1,251,500 12 months
N O'Sullivan, CFO GBP 701,000 GBP 730,000 12 months
16
L Nador, President, North America USD 521,000 USD 521,000 6 months
D Cuenca, President, Europe EUR 407,000 EUR 407,000 6 months
No increases are being made for the next two years effective 1 July 2023, except for N O'Sullivan.
Employee Share Plan
Brambles' employee share plan, MyShare, was launched in October 2008 and was developed as a vehicle to encourage share
ownership and retention across the Group. Employees may buy up to A$6,000 of shares each year (Acquired Shares), which the
Company matches (Matching Shares) on a one-for-one basis after a two-year qualifying period. The vesting and automatic exercise
of Matching Shares occurs on the second anniversary of the first acquisition.
Since 2020, MyShare is offered to all permanent employees of Brambles in approximately 60 countries.
As of 30 June 2023, 4.74 million Brambles shares were held by 4,565 MyShare participants.
Executive KMP are eligible to participate in MyShare. Shares obtained by Executive KMP through MyShare are included in
Section 9.6. Matching Shares allocated, but not yet vested, are shown in Sections 9.5 and 9.7.
During the Year, 1,149,365 Brambles shares were purchased on-market under the MyShare plan, being the Acquired Shares
purchased by participants in that plan, at an average price of A$12.66 per share. The fair value at grant ranged from A$10.90 to
A$13.60 (up to 30 June 2023) based on the monthly share price value. For further details of the share grant values, refer to Section
9.8 of the Remuneration Report and Note 21 of the Consolidated Financial Report.
Non-Executive Directors’ Disclosures
7.1 Non-Executive Directors’ Remuneration Policy
The Chair’s fees are determined by the Remuneration Committee, with the Chair recused from the decision. The other Non-
Executive Directors’ fees are determined by the Chair and Executive Directors. In setting the fees, advice is sought from external
remuneration advisors on the appropriate level of fees, taking into account the responsibilities of Non-Executive Directors in
dealing with the complexity and global nature of Brambles’ affairs and the level of fees paid to Non-Executive Directors in
comparable companies.
All Non-Executive Directors’ fees are set in Australian dollars and paid in local currencies.
Brambles’ base fees for Non-Executive Directors are set with reference to the comparator group of Australian ASX50 listed
companies.
The base fees for the Chair and Non-Executive Directors for FY23 were as follows:
- Chair: A$627,000; and
- Non-Executive Directors: A$209,000.
16
Nessa O'Sullivan will be retiring in FY24 and received a base salary increase instead of the LTI increase.
Directors’ Report – Remuneration ReportDirectors’ Report – Remuneration Report58 59
Directors’ Report – Remuneration Report – continued
The Chair and Non-Executive Director base fees have not increased since 1 July 2016. After conducting the reviews outlined above,
there will be an increase in base fees for the Chair and Non-Executive Directors for FY24 as follows:
- Chair: A$650,000; and
- Non-Executive Directors: A$217,000.
Non-Executive Directors are also entitled to the following travel allowances and Committee member fees, which were not increased
during the Year. These fees will not be increased for FY24:
- supplement for members of the Audit & Risk Committee and Remuneration Committee: A$25,000. The Board Chair does not
receive the supplement for membership of either of these Committees;
- supplement for Chair of the Audit & Risk Committee: A$50,000;
- supplement for Chair of the Remuneration Committee: A$40,000; and
- travel allowance of A$5,000 where a meeting involved a long-haul international trip.
The next fee review will take effect from 1 July 2024.
7.2 Non-Executive Directors’ Appointment Letters
Non-Executive Directors are appointed for an unspecified term, but are subject to election by shareholders at the first AGM after
their initial appointment by the Board. The 2022 Corporate Governance Statement, available on Brambles’ website, contains details
of the process for appointing and re-electing Non-Executive Directors and of the years in which the Non-Executive Directors are
next due for re-election by shareholders.
Letters of appointment for Non-Executive Directors, which are contracts for service but not contracts of employment, have been
put in place. These letters confirm that Non-Executive Directors have no right to compensation on the termination of their
appointment for any reason, other than for unpaid fees and expenses for the period served.
Non-Executive Directors do not participate in the PSP or MyShare plans.
Ms Priya Rajagopalan was appointed to the Board on 1 November 2022.
7.3 Non-Executive Directors’ Shareholdings
During the Year, the Board changed the MSR for Non-Executive Directors. Previously, they were required to hold shares in Brambles
equal to their annual fees after tax within three years of their appointment. As from 2022, they will now be required to hold shares
in Brambles, equal to their pre-tax annual base fees, within three years of their appointment. For existing Non-Executive Directors,
they must achieve the equivalent of their base fees before March 2025.
The following table contains details of Brambles Limited ordinary shares in which Non-Executive Directors held relevant interests,
being issued shares held by them and their related parties:
17
Ordinary shares Balance at the start of the Year Changes during the Year Balance at the end of the Year
Non-Executive Directors as at 30 June 2023
K Banks - 4,000 4,000
G El-Zoghbi 35,000 - 35,000
E Fagan 20,000 - 20,000
K McCall 8,925 9,500 18,425
J Miller 9,450 - 9,450
J Mullen 31,400 20,000 51,400
S Perkins 20,000 - 20,000
P Rajagopalan - 8,068 8,068
N Scheinkestel 19,774 251 20,025
17
K Banks: Held by Kendra Fowler Banks.
G El-Zoghbi: Held by The George El-Zoghbi Trust Agreement on behalf of George El-Zoghbi.
E Fagan: Held by LG Vestra, Bank of New York Mellon on behalf of Elizabeth Fagan.
K McCall: Held by BNP Paribas Nominees Australia Pty Limited on behalf of Ken McCall.
J Miller: Of which 5,150 shares are held by The Miller Family Revocable Trust on behalf of James Miller and 4,300 shares are held by James Richard Miller
J Mullen: 51,400 shares are held by Hederaberry Pty Limited as trusted for the Mullen Family Trust.
S Perkins: Held by Perkins Family Super Pty Ltd ATF Perkins Family S/F A/C.
P Rajagopalan: 8,068 ordinary shares held through 4,034 Brambles Limited American Depositary Receipts (Brambles ADRs), acquired by E*Trade Security LLC on behalf
of Priya Rajagopalan and Harish Devarajan.
N Scheinkestel: Of which 9,165 shares are held by Nora Scheinkestel and 10,860 shares are held by held by Scheinkestel Superannuation Pty Ltd.
Directors’ Report – Remuneration Report – continued
7.4 Non-Executive Directors’ Remuneration for the Year
Fees and other benefits provided to Non-Executive Directors during the Year and the prior year are set out in Section 7.4.1 below in
US dollars. The full names of the Non-Executive Directors and the dates of any changes in Non-Executive Directors during the Year
are shown in the Directors’ Report – Additional Information on page 67. Non-Executive Directors do not receive any share-based
payments.
Any contributions to personal superannuation or pension funds on behalf of the Non-Executive Directors are deducted from their
overall fee entitlements.
7.4.1 Non-Executive Directors’ Remuneration for the Year
US$'000
Year
Short-term employee benefits Post-employment benefits
Total Name Directors’ fees Superannuation
Other
18
Non-Executive Directors as at 30 June 2023
K Banks
FY23 137 14 - 151
FY22 23 2 - 25
G El-Zoghbi
FY23 152 16 - 168
FY22 157 16 - 173
E Fagan
FY23 184 5 3 192
FY22 183 3 2 188
K McCall
FY23 167 4 2 173
FY22 170 3 2 175
J Miller
FY23 171 - 3 174
FY22 162 7 2 171
J Mullen
FY23 427 - - 427
FY22 457 - - 457
S Perkins
FY23 195 - - 195
FY22 188 10 - 198
P Rajagopalan
FY23 101 - 1 102
FY22 - - - -
N Scheinkestel FY23 167 18 - 185
FY22 167 17 - 184
Totals
19
FY23 1,701 57 9 1,767
FY22 1,507 58 6 1,571
18
Other includes tax support services.
19
The year-on-year comparison of remuneration is affected by the movement of 30 June 2023 rates from A$1=US$0.7223, £1=US$1.3264 and €1=US$1.1220 for
FY22 to A$1=US$0.6750, £1=US$1.2110 and €1=US$1.0510 for FY23. The FY22 comparative has been restated by US$104,000 to exclude former Non-Executive
Directors who left in FY22.
Directors’ Report – Remuneration ReportDirectors’ Report – Remuneration Report60 61
Directors’ Report – Remuneration Report – continued
Remuneration Governance
8.1 Remuneration Committee
The Remuneration Committee operates under delegated authority from Brambles’ Board. Its responsibilities include:
- recommending overall Remuneration Policy to the Board;
- determining and implementing a process to enable the Committee to satisfy itself on the conduct of members of the ELT in
relation to Non-Financial Risks and reviewing and, if necessary, amending that process from time to time;
- recommending to the Board the overall remuneration for the CEO;
- approving the remuneration arrangements for the other Executive KMP; and
- reviewing the Remuneration Policy and individual remuneration arrangements for other senior executives.
During the Year, the Remuneration Committee applied the principles-based approach to Non-Financial Risks, described in
Section 3.3.1, to assist it in assessing the behaviours of executives and their remuneration outcomes. The Remuneration Committee
also works closely with the Audit & Risk Committee for assurance on the integrity of the financial performance outcomes
underlying remuneration determination. More broadly, the Remuneration Committee considers the Group’s overall performance,
both financial and non-financial, in its remuneration determinations.
During the Year, members of the Remuneration Committee were Mr Perkins (Committee Chair), Mr El-Zoghbi, Mr Mullen, Ms Fagan
and Mr Miller. Other individuals are invited to attend Remuneration Committee meetings as required by the Committee. This
includes members of Brambles’ management team including the CEO, Chief People Officer, the Chief Legal Officer & Company
Secretary, and Senior Vice President, Reward, as well as external remuneration advice as required.
During the Year, the Remuneration Committee held six meetings.
Details of the Remuneration Committee’s Charter can be found on the Corporate Governance page of Brambles' website.
8.2 Securities Trading Policy and Incentive Awards
Brambles' Securities Trading Policy applies to share awards granted under the incentive arrangements described in this report. That
policy prohibits designated persons (including all Executive KMP) from acquiring financial products or entering into arrangements
that have the effect of limiting exposure to the risk of price movements of Brambles’ securities. It is a term of senior executives’
employment contracts that they are required to comply with all Brambles' policies (including the Securities Trading Policy).
Management declarations are obtained twice yearly and include a statement that executives have complied with all policies.
8.3 Remuneration Advisors
The Remuneration Committee seeks external advice as required from specialist remuneration advisors who do not provide
recommendations.
Directors’ Report – Remuneration Report – continued
Other Reporting requirements
9.1 Share-Based Payments – Statutory Remuneration
The table below provides information on statutory remuneration for share awards relating to the years FY21 to FY23, which have
been amortised over two to three years. These share awards are subject to conditions set out in Section 4. Remuneration will be
received as a result of the underlying share awards vesting if the performance conditions have been met.
US$'000
Year
Share-based payment
Total
20
Name
Total before equity
13
Awards
Percentage of
total remuneration
Executive Directors
G Chipchase
FY23 3,072 2,428 44% 5,500
FY22 2,924 2,560 47% 5,484
N O'Sullivan
21
FY23 1,761 1,704 49% 3,465
FY22 1,692 1,448 46% 3,140
Other Executive KMP
D Cuenca FY23 796 468 37% 1,264
FY22 688 418 38% 1,106
L Nador
FY23 995 669 40% 1,664
FY22 933 619 40% 1,552
Totals FY23 6,624
5,269 11,893
FY22 6,237 5,045 11,282
9.2 LTI Share Awards still to be tested against performance conditions
The following table provides details of the level of vesting for the TSR component of LTI share awards granted in FY22 and FY23 if
the current TSR performance was to be maintained until the end of the applicable Performance Period:
Awards
made
during
Performance
condition
Start of
Performance Period
End of
Performance Period
Out-performance
of median company’s
TSR (%)
22
Period to 30 June 2023:
vesting if current performance is
maintained until testing date
(% of original award)
FY22 Relative TSR (ASX 100) 1 July 2021 30 June 2024 N/A 100% LTI TSR awards
FY22 Relative TSR (MSCI) 1 July 2021 30 June 2024 N/A 100% LTI TSR awards
FY23 Relative TSR (ASX 100) 1 July 2022 30 June 2025 N/A 100% LTI TSR awards
FY23 Relative TSR (MSCI) 1 July 2022 30 June 2025 N/A 100% LTI TSR awards
The following table provides details of the level of vesting for the sales revenue CAGR/ROCI component of LTI share awards
granted in FY22 and FY23 if the current sales revenue CAGR/ROCI performance was to be maintained until the end of the
applicable Performance Period:
Awards
made
during
Performance
condition
Start of
Performance Period
End of
Performance Period
Period to 30 June 2023: Vesting if
current performance is maintained until
testing date (% of original award)
FY22 Sales Revenue CAGR/ROCI 1 July 2021 30 June 2024 100% LTI Sales Revenue ROCI awards
FY23 Sales Revenue CAGR/ROCI 1 July 2022 30 June 2025 95% LTI Sales Revenue ROCI awards
20
The Total column represents the Total statutory remuneration.
21
The statutory remuneration presented reflects Nessa O'Sullivan's retirement in FY24 including impact on STI awards, and LTI awards on a pro-rata basis, relating to the
years FY21 to FY23.
22
Performance against both the ASX 100 and MSCI World Industrials indices will be based on the standard TSR ranking approach, with threshold vesting commencing at
the 50th percentile and progressively vesting to full vesting at the 75th percentile.
Directors’ Report – Remuneration ReportDirectors’ Report – Remuneration Report62 63
Directors’ Report – Remuneration Report – continued
9.3 Summary of STI and LTI Share Awards
The table below contains details of the STI and LTI share awards granted in which Executive KMP have unvested and/or unexercised
awards that could affect remuneration in this or future reporting periods. STI and LTI share awards do not have an exercise price
and carry no voting rights. The LTI share awards described as LTI TSR awards vest on the third anniversary of their grant date,
subject to continued employment and meeting the relevant TSR performance condition set out in Section 3.3.1. The LTI share
awards described as LTI ROCI vest on the third anniversary of their grant date, subject to continued employment and meeting a
sales revenue CAGR/ROCI performance condition set out in Section 3.3.1.
Details pertaining to Brambles' employee share plan, MyShare, are in Section 6.
Performance Share Plan awards Vesting condition
STI awards 100% vesting based on continuous employment
LTI TSR awards (ASX and MSCI) 50% vesting if TSR is equal to the median ranked company
100% vesting if at 75th percentile
Dividend Equivalent
From 2019 onwards, STI Awards that vest and are exercised entitle holders to a dividend
equivalent payment equal to the dividends declared by Brambles during the period
commencing on the day the award was granted and ending on the day the award vests or is
exercised. The dividend equivalent payment is paid either in cash or shares
FY21–FY23 LTI ROCI award 20% vesting occurs if CAGR is 3% and ROCI is 15.0% over three-year period
100% vesting occurs if CAGR is 4% and ROCI is 18.0% over three-year period
FY22–FY24 LTI ROCI award 20% vesting occurs if CAGR is 5% and ROCI is 15.5% over three-year period
100% vesting occurs if CAGR is 8% and ROCI is 17.0% over three-year period
FY23–FY25 LTI ROCI award 20% vesting occurs if CAGR is 5% and ROCI is 17.5% over three-year period
100% vesting occurs if CAGR is 8% and ROCI is 19.0% over three-year period
The terms and conditions of each grant of STI and LTI Share Awards affecting remuneration of Executive KMP in this or future
reporting periods are outlined in the table below. Awards granted under the plans do not have an exercise price and carry no
voting rights. The STI Awards vest on the second anniversary of their grant date, subject to continued employment.
Performance Share
Plan Awards Grant date Expiry date Value at grant Status/vesting date
STI/LTI TSR/
FY21-FY23 LTI ROCI
15 October 2020 15 October 2026
A$10.82 (STI) / A$10.05 (ROCI) /
A$4.52 (TSR-ASX) / A$4.56 (TSR-MSCI)
STI – 15 October 2022
LTI – 15 October 2023
STI/LTI TSR/
FY22-FY24 LTI ROCI
21 October 2021 21 October 2027 A$10.32 (STI) / A$9.50 (ROCI) /
A$4.50 (TSR-ASX) / A$4.92 (TSR-MSCI)
STI – 21 October 2023
LTI – 21 October 2024
STI/LTI TSR/
FY23-FY25 LTI ROCI
21 October 2022 21 October 2028 A$11.13 (STI) / A$10.15 (ROCI) /
A$6.48 (TSR-ASX) / A$6.90 (TSR-MSCI)
STI – 21 October 2024
LTI – 21 October 2025
9.4 Basis of Valuation of STI and LTI Share Awards
The fair values of the STI and LTI share awards included in the above table have been estimated in accordance with the
requirements of AASB 2 Share-based Payments, using a Monte Carlo simulation model for share rights subject to a market
condition and a risk-neutral assumption for non-market conditions. The assumptions used in the valuations are outlined in Note 21
of the Consolidate Financial Report.
This fair value is not used to calculate the number of STI and LTI share awards granted to executives. The number of share awards
granted is based on the market value of Brambles' shares which, under the PSP rules, is the volume weighted average share price
during the five trading days up to and including the grant date. This is termed as a 'face value approach'.
Directors’ Report – Remuneration Report – continued
9.5 Equity-Based Awards
The following table shows details of equity-based awards made to Executive KMP during the Year. STI and LTI share awards were
made under the PSP, the terms and conditions of which are set out in Section 3. MyShare Matching Shares were made under
MyShare, the terms and conditions of which are set out in Section 6. Approval for the STI and LTI share awards and MyShare
Matching Awards issued to Mr Chipchase and Ms O'Sullivan was obtained under ASX Listing Rule 10.14.
Name Type of award Number
Value at grant US$'000
23
Executive Directors
G Chipchase STI 126,991 914
LTI 254,064 1,828
MyShare Matching Shares 383 3
Totals 381,438 2,745
N O'Sullivan STI 74,790 538
LTI 142,308 1,024
MyShare Matching Shares 467 4
Totals 217,565 1,566
Other Executive KMP
D Cuenca STI 21,158 152
LTI 55,364 398
MyShare Matching Shares 473 4
Totals 76,995 554
L Nador STI 46,805 337
LTI 72,417 521
MyShare Matching Shares 419 4
Totals 119,641 862
9.6 Shareholdings
The following table shows details of Brambles Limited ordinary shares in which the Executive KMP held relevant interests, being
issued shares held by them and their related parties.
24,25,26
Ordinary shares Balance at the start of the Year Changes during the Year Balance at the end of the Year
Executive Directors
G Chipchase 361,383 117,659 479,042
N O'Sullivan 204,713 67,308 272,021
Other Executive KMP
D Cuenca 33,637 15,742 49,379
L Nador 92,576 25,805 118,381
23
The total value of the relevant equity award(s) is valued as at the date of grant using the methodology set out in Section 3.2. The minimum possible future value of all
awards yet to vest is zero and is based on the performance/service conditions not being met. The maximum possible future value of awards yet to vest is equal to the
value at grant.
24
On 31 July 2023, the following Executive KMP acquired ordinary shares under MyShare, which are held by Certane CT Pty Ltd: G Chipchase (30), N O'Sullivan (39),
D Cuenca (38), and L Nador (43).
On 31 July 2023, the following Executive KMP received Matching Awards under MyShare: G Chipchase (30), N O'Sullivan (39), D Cuenca (38), and L Nador (43).
25
G Chipchase: of which 31,200 shares are held by Multrees Investor Services and 447,842 shares are held by Certane CT Pty Ltd.
N O'Sullivan: of which 9,000 shares are held in her own name and 263,021 shares are held by Certane CT Pty Ltd.
D Cuenca: all of his shares are held by Certane CT Pty Ltd.
L Nador: of which 3,773 shares are held in her own name and 114,608 are held by Certane CT Pty Ltd.
26
The applicable total includes dividend equivalent shares acquired under the PSP.
Directors’ Report – Remuneration ReportDirectors’ Report – Remuneration Report64 65
Directors’ Report – Remuneration Report – continued
9.7 Interests in Share Rights
27
The following table shows details of rights over Brambles Limited ordinary shares in which the Executive KMP held relevant interests
being STI and LTI share awards made on 15 October 2019, 15 October 2020, 21 October 2021 and 21 October 2022 under the PSP;
and Matching Shares, being conditional rights awarded during the Year under MyShare.
26,28
Executive KMP
Balance at the
start of the Year
Granted
during the Year
Exercised
during the
Year
29
Lapsed
during the
Year
30
Balance at
the end of
the Year
Vested and
exercisable at
end of the Year
Value at
exercise
(US$'000)
Executive Directors
G Chipchase 1,035,303 381,438 (224,918) (125,260) 1,066,563 - 1,637
N O'Sullivan 581,291 217,565 (128,127) (70,008) 600,721 - 933
Other Executive KMP
D Cuenca 170,558 76,995 (26,849) (8,400) 212,304 - 192
L Nador 247,260 119,641 (63,490) (28,186) 275,225 - 453
9.8 Employee Share Plan
The terms and conditions of each grant of Matching Shares affecting remuneration in this or future reporting periods are outlined
in the table below. Share rights granted under the plans do not have an exercise price and carry no dividend or voting rights.
Plan Grant date Expiry date Value at grant
Matching Shares /
vesting date
MyShare 2021
31
Each month from
31 March 2021 to 28 February 2022
1 April 2023
Values range per month from
A$9.24 to A$11.53
31 March 2023
MyShare 2022
32
Each month from
31 March 2022 to 28 February 2023
1 April 2024 Values range per month from
A$9.41 to A$12.19
31 March 2024
MyShare 2023
33
Each month from
31 March 2023 to 31 July 2023
1 April 2025 Values range per month from
A$12.66 to A$13.60
31 March 2025
27
Of the awards detailed in Section 9.3 and Section 6, the following plan items are relevant to Executive KMP: G Chipchase, N O'Sullivan, D Cuenca, L Nador (STI, LTI TSR,
LTI 20-22 ROCI, LTI 21-23 ROCI, LTI 22-24 ROCI, LTI 23-25 ROCI, MyShare 2021, 2022 and 2023).
Lapses occurred for: G Chipchase, N O'Sullivan, D Cuenca and L Nador (LTI 20-22 TSR).
Exercises occurred for: G Chipchase, N O'Sullivan, D Cuenca and L Nador (STI, FY20-22 LTI ROCI, MyShare 2021).
28
During the Year, 3,320,050 equity-settled performance share rights were granted under the PSP, of which 381,055 were granted to G Chipchase and 217,098 were
granted to N O’Sullivan. 1,149,365 Matching Shares were granted under MyShare during the Year, of which 383 were granted to G Chipchase and 467 were granted
to N O’Sullivan.
29
Of the rights exercised during the Year, no monies were paid or payable on exercise. The shares issued on exercise of share rights are fully paid up.
30
'Lapse' in this context means that the awards were forfeited due to either the applicable service or performance conditions not being met.
31
The Matching Shares granted under the MyShare 2021 Plan vest on 31 March 2023, subject to continuing employment and the retention of the associated Acquired
Shares. On vesting, they are automatically exercised.
32
The Matching Shares granted under the MyShare 2022 Plan vest on 31 March 2024, subject to continuing employment and the retention of the associated Acquired
Shares. On vesting, they are automatically exercised.
33
The final grant under the MyShare 2023 Plan will occur on 29 February 2024. For FY23 reporting purposes, data is only available up to 31 July 2023. The remaining
information will be reported in the 2024 Annual Report. The Matching Shares granted under MyShare will vest on 31 March 2025, subject to continuing employment
and the retention of the associated Acquired Shares. On vesting they are automatically exercised.
Directors’ Report – Additional Information
The information presented in this report relates to the
consolidated entity, the Brambles Group, consisting of
Brambles Limited and the entities it controlled at the end of,
or during, the year ended, 30 June 2023 (the Year).
Principal Activities
The principal activities of the Group during the Year were the
provision of supply chain logistics solutions, focusing on the
provision of reusable pallets and containers, of which
Brambles is a leading global provider.
Further details of the Group’s activities are set out in the
Operating & Financial Review on pages 6 to 39.
There were no significant changes in the nature of the Group’s
principal activities during the Year.
Review of Operations and Results
A review of the Group’s operations and of the results of
those operations are given in the Letter from the Chair & CEO
on pages 3 to 5 and the Operating & Financial Review on
pages 6 to 39.
Information about the financial position of the Group is
included in the Operating & Financial Review on pages 6 to 39
and in the Five-Year Financial Performance Summary on
page 140.
Significant Changes in State of Affairs
There were no significant changes to the state of affairs of the
Group for the Year.
Matters Since the End of the Financial Year
The Directors are not aware of any matter or circumstance
that has arisen since 30 June 2023 up to the date of this report
that has significantly affected or may significantly affect the
operations of the Group, the results of those operations or the
state of affairs of the Group in future financial years.
Business Strategies and Prospects for Future
Financial Years
The business strategies and prospects for future financial
years, together with likely developments in the operations of
the Group in future financial years and the expected results of
those operations known at the date of this report, are set out
in the Letter from the Chair & CEO on pages 3 to 5 and in the
Operating & Financial Review on pages 6 to 39.
Further information in relation to such matters has not been
included because the Directors believe it would be likely to
result in unreasonable prejudice to the Group.
Dividends
The Directors have declared a final dividend for the Year of
14.0 US cents per share, to be paid in Australian dollars at
21.83 Australian cents per share, and which will be 35%
franked. The dividend will be paid on 12 October 2023
to shareholders on the register on 14 September 2023.
On 13 April 2023, an interim dividend for the Year was paid,
which was 12.25 US cents per share and 35% franked.
On 13 October 2022, a final dividend for the year ended
30 June 2022 was paid, which was 12 US cents per share and
35% franked.
The unfranked component of each dividend paid during the
Year was conduit foreign income. This means that no
Australian dividend withholding tax was payable on the
dividends that Brambles paid to non-resident shareholders.
Directors
The name of each person who was a Director of Brambles
Limited at any time during or since the end of the Year, and
the period they served as a Director during the Year, is set out
below.
The qualifications, experience and special responsibilities of
Directors are set out on pages 40 to 43.
Kendra Fowler Banks 1 July 2022 to date
Graham Andrew Chipchase 1 July 2022 to date
George El-Zoghbi 1 July 2022 to date
Elizabeth Fagan 1 July 2022 to date
Kenneth Stanley McCall 1 July 2022 to date
James Richard Miller 1 July 2022 to date
John Patrick Mullen 1 July 2022 to date
Nessa O'Sullivan 1 July 2022 to date
Scott Redvers Perkins 1 July 2022 to date
Priya Rajagopalan 1 November 2022 to date
Nora Lia Scheinkestel 1 July 2022 to date
Secretary
Details of the qualifications and the experience of
Robert Nies Gerrard, Chief Legal Officer & Company Secretary
of Brambles Limited, are set out on page 45.
Details of the qualifications and experience of Carina Thuaux,
Deputy Group Company Secretary & Corporate Counsel of
Brambles Limited, are as follows: Carina joined Brambles in
January 2014 as Assistant Company Secretary, and was most
recently appointed as Deputy Group Company Secretary &
Corporate Counsel in April 2023. She has also held the
position of Legal Counsel in Australia and the UK. Prior to
joining Brambles, she was a solicitor with King & Wood
Mallesons. She holds a Bachelor of Commerce and a
Bachelor of Law from the University of New South Wales.
She is a Solicitor of the Supreme Court of New South Wales.
Directors’ Report – Additional Information 67Directors’ Report – Remuneration Report66
Directors’ Report – Additional Information – continued
Indemnities
Under its constitution, to the extent permitted by law,
Brambles Limited indemnifies each person who is, or has
been, a Director or Secretary of Brambles Limited against any
liability which results from facts or circumstances relating to
the person serving or having served in the capacity of
Director, Secretary, other officer or employee of Brambles
Limited or any of its subsidiaries, other than:
- in respect of a liability other than for legal costs:
- a liability owed to Brambles Limited or a related
body corporate;
- a liability for a pecuniary penalty order under section
1317G of the Corporations Act 2001 (Cth) (Act) or
a compensation order under Section 1317H of
the Act; or
- a liability that is owed to someone (other than
Brambles Limited or a related body corporate) and
did not arise out of conduct in good faith;
- in respect of a liability for legal costs:
- in defending or resisting criminal proceedings in
which the person is found to have a liability for which
they could not have been indemnified in respect of a
liability owed to Brambles Limited or a related body
corporate;
- in defending or resisting criminal proceedings in
which the person is found guilty;
- in defending or resisting proceedings brought by
ASIC or a liquidator for a Court order if the grounds
for making the order are found by the Court to be
established. This does not apply to costs incurred in
responding to actions brought by the Australian
Securities & Investment Commission (ASIC) or a
liquidator as part of an investigation before
commencing proceedings for a Court order; or
- in connection with proceedings for relief to any
persons under the Act in which the Court denies
the relief.
As allowed by its constitution, Brambles Limited has provided
indemnities to its Directors, Secretaries or other Statutory
Officers of its subsidiaries (Beneficiaries) against all loss, cost
and expenses (collectively Loss) caused by or arising from any
act or omission by the relevant person in performance of that
person's role as a Director, Secretary or Statutory Officer.
The indemnity given by Brambles Limited excludes the
following matters:
- any Loss to the extent caused by or arising from an act or
omission of the Beneficiary prior to the effective date of
the indemnity;
- any Loss to the extent indemnity in respect of that Loss is
prohibited under the Act (or any other law);
- any Loss to the extent it arises from private or personal
acts or omissions of the Beneficiary;
- any Loss comprising the reimbursement of normal day-
to-day expenses such as travelling expenses;
- any Loss to the extent the Beneficiary failed to act
reasonably to mitigate the Loss;
- any Loss to the extent it is caused by or arises from acts
or omissions of the Beneficiary after the date the
indemnity is revoked by Brambles Limited in accordance
with the terms of the indemnity; and
- any Loss to the extent it is caused by or arises from any
breach by the Beneficiary of the terms of the indemnity.
Insurance policies are in place to cover Directors and
executive officers; however, the terms of the policies prohibit
disclosure of the details of the insurance cover and the
premiums paid.
Directors’ Report – Additional Information – continued
Directors’ Meetings
Details of Board Committee memberships are given in the Directors' biographies on pages 40 to 43. The following table
shows the actual Board and Committee meetings held during the Year and the number attended by each Director or
Committee member.
Directors
Board meetings
Regular Special Committees Audit & Risk
Committee meetings
Remuneration
Committee meetings
Nominations
Committee meetings
(a) (b) (a) (b) (a) (b) (a) (b) (a) (b)
K F Banks 12 12 - - - - - - 3 3
G A Chipchase 12 12 2 2 - - - - 3 3
G El-Zoghbi 12 12 - - - - 6 6 3 3
E Fagan 12 12 - - 6 6 6 6 3 3
K S McCall 12 12 2 2 6 6 - - 3 3
J R Miller 12 12 - - - - 6 6 3 3
J P Mullen 11 12 2 2 - - 5 6 3 3
N O'Sullivan 12 12 4 4 - - - -
3 3
S R Perkins 11 12 - - 6 6 6 6 3 3
P Rajagopalan 9 9 - - - - 2 2
N L Scheinkestel 12 12 4 4 6 6 - - 3 3
a) The number of meetings attended during the period the Director was a member of the Board or relevant Committee which
the Director was eligible to attend.
b) The number of meetings held while the Director was a member of the Board or relevant Committee which the Director was
eligible to attend.
Directors’ Report – Additional InformationDirectors’ Report – Additional Information68 69
Directors’ Report – Additional Information – continued
Directors’ Directorships of Other Listed Companies
The following lists the directorships held by the Directors in listed companies (other than Brambles Limited) since 30 June 2020.
Director Listed company Period directorship held
K F Banks None -
G A Chipchase AstraZeneca plc 2012 to April 2021
G El-Zoghbi The Kraft Heinz Company 2018 to April 2021
Goodman Group:
- Goodman Limited
- Goodman Funds Management Limited
April 2023 to current
April 2023 to current
E Fagan None -
K S McCall Post Office Limited 2016 to January 2022
J R Miller The RealReal, Inc. 2019 to current
LivePerson, Inc. January 2023 to current
J P Mullen Telstra Corporation Limited 2008 to current
Brookfield Infrastructure Corporation 2021 to current
Treasury Wine Estates May 2023 to current
N O'Sullivan Molson Coors Beverage Company 2020 to current
S R Perkins Woolworths Group Limited 2014 to current
Origin Energy Limited 2015 to current
P Rajagopalan None -
N L Scheinkestel Atlas Arteria:
- Atlas Arteria Limited
1
2014 to November 2020
- Atlas Arteria International Limited
1
2015 to November 2020
AusNet Services Ltd 2016 to February 2022
Origin Energy Limited 2022 to current
Telstra Corporation Limited 2010 to October 2022
Westpac Banking Corporation 2021 to current
1
Stapled entities.
Directors’ Report – Additional Information – continued
Environmental Regulation
Except as set out below, the Group’s operations in Australia
are not subject to any particular and significant environmental
regulation under a law of the Commonwealth or a State or
Territory. The operations of the Group in Australia involve the
use or development of land, the use of transportation
equipment and the transport of goods. These operations may
be subject to State, Territory or local government
environmental and town planning regulations, or require
a licence, consent or approval from Commonwealth, State or
Territory regulatory bodies. There were no material breaches
of environmental statutory requirements and no material
prosecutions during the Year. Brambles’ businesses comply
with all relevant environmental laws and regulations and none
were involved in any material environmental prosecutions
during the Year.
The Group’s operations are subject to numerous
environmental laws and regulations in the other countries in
which it operates. There were no material breaches of these
laws or regulations during the Year.
Corporate Governance Statement
Brambles is committed to observing the corporate
governance requirements applicable to publicly listed
companies in Australia. The Board has adopted a Corporate
Governance Framework designed to enable Brambles to meet
its legal, regulatory and governance requirements.
During the Year, the Board believes Brambles met all the
requirements of the Fourth Edition of the CGPR. Brambles'
2023 Corporate Governance Statement is on Brambles'
website at brambles.com/corporate-governance-overview.
Interests in Securities
Pages 60 and 65 of the Directors’ Report – Remuneration
Report include details of the relevant interests of Directors,
and other Group executives whose details are required to be
disclosed, in shares and other securities of Brambles Limited.
Share Capital and Share Rights
Details of the changes in the issued share capital of
Brambles Limited and performance share rights and MyShare
matching share rights over unissued Brambles Limited
ordinary shares at the year end are given in Notes 20 and 21
of the Consolidated Financial Report on pages 110 to 112.
No options, performance share rights or MyShare matching
share rights over the shares of Brambles Limited’s controlled
entities were granted during or since the end of the Year to
the date of this report.
Since the end of the Year to the date of this report:
- 5,025 fully paid Brambles Limited ordinary shares
were issued as a result of the exercise of 3,287 MyShare
matching share rights under the 2022 MyShare Plan and
the exercise of 1,738 MyShare matching share rights
under the 2023 MyShare plan;
- 99,271 MyShare matching share rights have been
issued under the 2023 MyShare Plan; and
- 8,762 MyShare matching share rights lapsed under the
2022 MyShare Plan, 9,664 MyShare matching share rights
lapsed under the 2023 MyShare Plan and 62,573
performance share rights lapsed.
Non-Audit Services and Auditor Independence
The amount of US$14,000 was paid or is payable to PwC, the
Group’s auditors, for non-audit services provided during the
Year by them (or another person or firm on their behalf).
These services primarily related to corporate administration.
The Audit & Risk Committee has reviewed the provision of
non-audit services by PwC and its related practices, and
provided the Directors with formal written advice of a
resolution passed by the Audit & Risk Committee. Consistent
with this advice, the Directors are satisfied that the provision
of non-audit services by PwC and its related practices did not
compromise the auditor independence requirements of the
Act for the following reasons: the nature of the non-audit
services provided during the Year, the quantum of non-audit
fees compared to overall audit fees, and the pre-approval,
monitoring and ongoing review requirements under the
Audit & Risk Committee Charter and the Charter of Audit
Independence in relation to non-audit work.
The auditors have also provided the Audit & Risk Committee
with a letter confirming that, in their professional judgement,
as at 18 August 2023 they have maintained their
independence in accordance with their firm’s requirements,
with the provisions of APES 110 – Code of Ethics for
Professional Accountants and with the applicable provisions of
the Act. On the same basis, they also confirmed that the
objectivity of the audit engagement partners and the audit
staff is not impaired.
Auditor's Independence Declaration
A copy of the auditor’s independence declaration as required
under Section 307C of the Act is set out on page 139.
Annual General Meeting
Brambles' 2023 Annual General Meeting (AGM) will be held at
2.00pm (AEDT) on 12 October 2023. The AGM will be held as a
hybrid meeting. Full details on the AGM will be in the Notice
of Meeting, which will be sent to shareholders and posted on
brambles.com in early September 2023.
This Directors’ Report is made in accordance with a resolution
of the Board.
John Mullen Graham Chipchase
Chair Chief Executive Officer
30 August 2023
Directors’ Report – Additional InformationDirectors’ Report – Additional Information70 71
Shareholder Information
Stock Exchange Listing
Brambles’ ordinary shares are listed on the Australian
Securities Exchange and are traded under the stock
code 'BXB'.
Uncertificated Forms of Shareholding
Brambles’ ordinary shares are held in uncertificated form.
There are two types of uncertificated holdings:
- Issuer Sponsored Holdings: This type of holding is
recorded on a subregister of the Brambles share register,
maintained by Brambles. If your holding is recorded on
the issuer sponsored subregister, you will be allocated a
Securityholder Reference Number, or SRN, which is a
unique number used to identify your holding of ordinary
shares in Brambles; and
- Broker Sponsored Holdings: This type of holding is
recorded on the main Brambles share register.
Shareholders who are sponsored by an ASX market
participant broker will be allocated a Holder Identification
Number, or HIN. One HIN can relate to an investor’s
shareholdings in multiple companies. For example, a
shareholder with a portfolio of holdings which are
managed by a broker would have the same HIN for
each shareholding.
American Depository Receipts
Brambles Limited shares may be traded in sponsored
American Depository Receipts form in the United States.
Dividend
Dividends are paid in Australian dollars or US dollars.
Shareholders may elect to have their dividend paid in the
currency of their registered address through a service
provided by Brambles' share registry by contacting
Boardroom at the address set out in Contact Information on
the inside back cover of this Annual Report.
Annual General Meeting
The Brambles Limited 2023 AGM will be held at
2.00pm (AEDT) on 12 October 2023. The AGM will be held as
a hybrid meeting. Full details of the AGM will be in the
Notice of Meeting, which will be sent to shareholders and
posted on brambles.com in early September 2023.
Financial Calendar
Final Dividend 2023
Ex-dividend date – Wednesday, 13 September 2023
Record date – Thursday, 14 September 2023
Payment date – Thursday, 12 October 2023
2024 (Provisional)
Announcement of interim results – mid-February 2024
Interim dividend – mid-April 2024
Announcement of final results – mid-August 2024
Final dividend – mid-October 2024
AGM – October 2024
Company Secretaries
R N Gerrard
C Thuaux
Analysis of Holders of Equity Securities as at 18 August 2023
Substantial Shareholders
Brambles has been notified of the following substantial shareholdings:
Holder Number of ordinary shares % of issued ordinary share capital
1
Blackrock Group 116,622,353 8.12
2
State Street Corporation 85,129,663 6.14
Vanguard Group 69,541,291 5.01
3
Number of Ordinary Shares on Issue and Distribution of Holdings
Holders % of issued ordinary share capital
1–1,000 34,545 1.05
1,001–5,000 27,797 4.63
5,001–10,000 4,421 2.23
10,001–100,000 2,468 3.66
100,001 and over 83 88.43
Total 69,314 100
There are 1,389,309,081 Brambles Limited ordinary shares on issue. The number of members holding less than a marketable
parcel of 35 ordinary shares (based on a closing market price of A$14.07 on 18 August 2023) is 1,928 and they hold a total of
19,505 ordinary shares. The voting rights of ordinary shares are described on page 73.
1
Percentages are as disclosed in substantial holding notices given to Brambles Limited.
2
Blackrock Group also holds 1,774,136 ordinary shares (0.12% of issued share capital) through Brambles American Depositary Receipts.
3
Vanguard Group also holds 42,205 ordinary shares through Brambles American Depositary Receipts.
Shareholder Information – continued
Unquoted equity securities: Number of Share Rights over Unissued ordinary shares and Distribution of Holdings
Holders % of issued share rights
1–1,000 3,960 15.07
1,001–5,000 25 0.74
5,001–10,000 21 1.81
10,001–100,000 113 39.52
100,001 and over 15 42.86
Total 4,134 100
There are 8,945,931 share rights over unissued ordinary shares. The voting rights of those share rights are described below.
Twenty Largest Ordinary Shareholders
Name
Number of
ordinary shares
% of
issued ordinary
share capital
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED 585,269,930 42.13
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED 247,012,849 17.78
CITICORP NOMINEES PTY LIMITED 160,509,783 11.55
BNP PARIBAS NOMS PTY LTD <DRP> 68,003,771 4.90
NATIONAL NOMINEES LIMITED 37,100,135 2.67
BNP PARIBAS NOMS PTY LTD DEUTSCHE BANK TCA <DRP> 23,506,534 1.69
CITICORP NOMINEES PTY LIMITED <COLONIAL FIRST STATE INV A/C> 21,836,208 1.57
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED <NT-COMNWLTH SUPER CORP A/C> 9,436,487 0.68
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD <DRP A/C> 6,460,826 0.47
AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED 6,200,000 0.45
ARGO INVESTMENTS LIMITED 5,639,109 0.41
CERTANE SPV MANAGEMENT PTY LTD <BRAMBLES - MYSHARE A/C> 4,718,428 0.34
BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM 4,053,979 0.29
NETWEALTH INVESTMENTS LIMITED <WRAP SERVICES A/C> 4,033,972 0.29
BNP PARIBAS NOMS (NZ) LTD <DRP> 3,023,949 0.22
BNP PARIBAS NOMINEES PTY LTD <AGENCY LENDING DRP A/C> 2,756,428 0.20
CUSTODIAL SERVICES LIMITED <BENEFICIARIES HOLDING A/C> 2,319,954 0.17
BNP PARIBAS NOMS PTY LTD <GLOBAL MARKETS DRP> 2,271,105 0.16
BNP PARIBAS NOMINEES PTY LTD <AGENCY LENDING COLLATERAL > 2,086,200 0.15
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2 2,023,829 0.15
Total holdings of 20 largest holders 1,198,263,476 86.25
Voting Rights: Ordinary Shares
Brambles Limited’s constitution provides that each member entitled to attend and vote may do so in person or by proxy, by
attorney or, where the member is a body corporate, by representative. The Directors may also determine that at any general
meeting, a member who is entitled to attend and vote on a resolution at that meeting is entitled to a direct vote in relation to
that resolution. The Directors have prescribed rules to govern direct voting, which are available at brambles.com.
On a show of hands, every member present in person, by proxy, by attorney or, where the member is a body corporate, by
representative, and having the right to vote on a resolution, has one vote. The Directors have determined that members who
submit a direct vote on a resolution will be excluded on a vote on that resolution by a show of hands or on a poll. The Directors
have determined that votes cast by members who submit a direct vote will be included on a vote by a poll, being one vote for
each ordinary share held.
Voting Rights: Share Rights
Share rights over unissued ordinary shares do not carry any voting rights.
Shareholder InformationShareholder Information72 73
Consolidated Financial Report
for the year ended 30 June 2023
INDE
X
PAGE
Consolidated Statement of Comprehensive Income 75
Consolidated Balance Sheet 76
Consolidated Cash Flow Statement 77
Consolidated Statement of Changes in Equity 78
Notes to and Forming Part of the Financial Statements
1 About This Report 79
2 Segment Information – Continuing Operations 82
3 Operating Expenses – Continuing Operations 86
4 Net Finance Costs – Continuing Operations 87
5 Income Tax 88
6 Earnings Per Share 92
7 Dividends 94
8 Investment in Associates 95
9 Discontinued Operations 96
10 Trade and Other Receivables 98
11 Inventories 99
12 Other Assets 99
13 Property, Plant and Equipment 100
14 Right-of-Use Leased Assets 102
15 Goodwill and Intangible Assets 104
16 Trade and Other Payables 107
17 Provisions 107
18 Borrowings 108
19 Retirement Benefit Obligations 108
20 Contributed Equity 110
21 Share-Based Payments 111
22 Reserves and Retained Earnings 113
23 Financial Risk Management 115
24 Cash Flow Statement – Additional Information 123
25 Capital Expenditure Commitments 125
26 Contingencies 126
27 Auditor’s Remuneration 127
28 Key Management Personnel 128
29 Related Party Information 128
30 Events After Balance Sheet Date 129
31 Net Assets Per Share 130
32 Parent Entity Financial Information 130
Directors' Declaration 132
Independent Auditor's Report 133
Auditor's Independence Declaration 139
Consolidated Statement of Comprehensive Income
for the year ended 30 June 2023
2023 2022
Note US$m US$m
Continuing operations
Sales revenue 2 6,076.8 5,519.8
Other income and other revenue 318.9 287.7
Operating expenses 3 (5,324.0) (4,872.9)
Share of results of associates 8 (4.7) (4.6)
Operating profit 1,067.0 930.0
Finance revenue 16.0 11.5
Finance costs (130.1) (97.8)
Net finance costs 4 (114.1) (86.3)
Net impact arising from hyperinflationary economies 1H (18.7) (22.0)
Profit before tax 934.2 821.7
Tax expense 5A (287.1) (247.9)
Profit from continuing operations 647.1 573.8
Profit from discontinued operations 9 56.2 19.5
Profit for the year attributable to members of the parent entity 703.3 593.3
Other comprehensive income:
Items that will not be reclassified to profit or loss:
Actuarial (loss)/gain on defined benefit pension plans 19 (17.4) 22.5
5A 4.4 (5.7)
(13.0) 16.8
Items that may be reclassified to profit or loss:
Exchange differences on translation of foreign subsidiaries 22 (5.4) (167.3)
Exchange differences released to profit on divestment of CHEP China 22 (1.2) -
(6.6) (167.3)
Other comprehensive loss for the year (19.6) (150.5)
683.7 442.8
Earnings per share (EPS) – US Cents
Continuing operations
- basic 6 46.6 40.5
- diluted 46.4 40.4
Total
- basic 50.7 41.9
- diluted 50.4 41.7
The consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
Total comprehensive income for the year attributable to members of
the parent entity
Tax benefit/(expense) on items that will not be reclassified to profit or loss
74 Consolidated Financial Report Consolidated Financial Report 75
Consolidated Balance Sheet
as at 30 June 2023
2023 2022
Note US$m US$m
Assets
Current assets
Cash and cash equivalents 24 160.7 158.2
Trade and other receivables 10 1,126.4 978.5
Inventories 11 83.9 94.5
Other assets 12 73.9 90.4
Total current assets 1,444.9 1,321.6
Non-current assets
Other receivables 10 21.2 49.6
Property, plant and equipment 13 6,062.0 5,526.0
Right-of-use leased assets 14 637.7 617.5
Goodwill and intangible assets 15 241.3 243.5
Investments in associates 8 156.9 44.6
Deferred tax assets 5C 154.5 128.9
Total non-current assets 7,273.6 6,610.1
Total assets 8,718.5 7,931.7
Liabilities
Current liabilities
Trade and other payables 16 2,074.9 1,860.1
Lease liabilities 24C 110.2 140.0
Borrowings 18 562.1 53.7
Tax payable 2 66.5 61.1
Provisions 17 174.7 122.1
Total current liabilities 2,988.4 2,237.0
Non-current liabilities
Lease liabilities 24C 619.2 573.4
Borrowings 18 1,592.8 2,108.4
Provisions 17 75.3 75.8
Retirement benefit obligations 19 16.3 2.2
Deferred tax liabilities 5C 556.5 483.0
Other liabilities 16 - 0.8
Total non-current liabilities 2,860.1 3,243.6
Total liabilities 5,848.5 5,480.6
Net assets 2,870.0 2,451.1
Equity
Contributed equity 20 4,531.6 4,505.8
Reserves 22 (7,341.8) (7,376.6)
Retained earnings 22 5,680.2 5,321.9
Total equity 2,870.0 2,451.1
The consolidated balance sheet should be read in conjunction with the accompanying notes.
Consolidated Cash Flow Statement
for the year ended 30 June 2023
2023 2022
Note US$m US$m
Cash flows from operating activities
Receipts from customers 7,038.9 6,358.9
Payments to suppliers and employees (4,721.4) (4,489.0)
Cash generated from operations 2,317.5 1,869.9
Interest received 5.6 3.0
Interest paid
1
(117.3) (83.6)
Income taxes paid (214.7) (203.5)
Net cash inflow from operating activities 24B 1,991.1 1,585.8
Cash flows from investing activities
Payments for property, plant and equipment
(1,668.3) (1,652.3)
Proceeds from sale of property, plant and equipment
2
191.5 172.5
Payments for intangible assets
(16.2) (19.8)
9 (12.4) -
Net cash outflow from investing activities (1,505.4) (1,499.6)
Cash flows from financing activities
Proceeds from borrowings 2,570.0 1,601.5
Repayment of borrowings (2,603.2) (1,000.3)
Payment of principal component of lease liabilities (125.4) (132.6)
Net inflow/(outflow) from derivative financial instruments 1.1 (49.0)
Payments for share buy-back 20 - (443.9)
Dividends paid – ordinary 7 (318.6) (304.8)
Net cash outflow from financing activities (476.1) (329.1)
Net increase/(decrease) in cash and cash equivalents 9.6 (242.9)
Cash and cash equivalents, net of overdrafts, at beginning of the year 155.9 407.0
Effect of exchange rate changes (8.9) (8.2)
Cash and cash equivalents, net of overdrafts, at end of the year 24A 156.6 155.9
1
2
The consolidated cash flow statement should be read in conjunction with the accompanying notes.
Includes interest paid on leases of US$28.2 million in 2023 (2022: US$24.1 million).
Payments relating to divested businesses and cash disposed
Includes compensation for lost pooling equipment of US$184.2 million in 2023 (2022: US$171.0 million).
76 Consolidated Financial Report Consolidated Financial Report 77
Consolidated Statement of Changes in Equity
for the year ended 30 June 2023
Contributed Retained
equity Reserves earnings Total
Note US$m US$m US$m US$m
Year ended 30 June 2022
Opening balance as at 1 July 2021 4,924.8 (7,246.4) 5,011.5 2,689.9
Profit for the year - - 593.3 593.3
Other comprehensive (loss)/income - (167.3) 16.8 (150.5)
Total comprehensive (loss)/income - (167.3) 610.1 442.8
Revaluation of reserves relating to hyperinflation - 34.0 - 34.0
Share-based payments:
- expense recognised 21 - 28.3 - 28.3
- shares issued - (24.9) - (24.9)
- equity component of related tax - (0.3) - (0.3)
- dividends declared 7 - - (299.7) (299.7)
- issue of ordinary shares, net of transaction costs 20 24.9 - - 24.9
- share buy-back 20 (443.9) - - (443.9)
Closing balance as at 30 June 2022 4,505.8 (7,376.6) 5,321.9 2,451.1
Year ended 30 June 2023
Opening balance at 1 July 2022 4,505.8 (7,376.6) 5,321.9 2,451.1
Profit for the year - - 703.3 703.3
Other comprehensive loss -
(5.4) (13.0) (18.4)
FCTR released to profit on divestment of CHEP China - (1.2) - (1.2)
Total comprehensive (loss)/income - (6.6) 690.3 683.7
Revaluation of reserves relating to hyperinflation - 36.2 - 36.2
Share-based payments:
- expense recognised 21 - 27.5 - 27.5
- shares issued - (25.8) - (25.8)
- equity component of related tax - 3.5 - 3.5
Transactions with owners in their capacity as owners:
- dividends declared 7 - - (332.0) (332.0)
- issue of ordinary shares, net of transaction costs 20 25.8 - - 25.8
Closing balance as at 30 June 2023 4,531.6 (7,341.8) 5,680.2 2,870.0
The consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
Transactions with owners in their capacity as owner
s
Notes to and Forming Part of the Financial Statements
for the year ended 30 June 2023
Note 1. About This Report
A) Basis of Preparation
B) Principles of Consolidation
The financial statements and all comparatives have been prepared using the accounting policies disclosed throughout the financial
statements, which are consistent with the prior year.
As Brambles is a company of a kind referred to in ASIC Corporations (Rounding in Financial/Directors' Reports) Instrument
2016/191, relevant amounts in the financial statements and Directors’ Report have been rounded to the nearest hundred thousand
US dollars or, in certain cases, to the nearest thousand US dollars. Amounts in cents have been rounded to the nearest
tenth of a cent.
The Task Force on Climate-related Financial Disclosures (TCFD) is a reporting framework that aims to improve and increase the
level of climate-related financial information. In preparing the consolidated financial statements the impact of climate change risks
has been considered. Relevant disclosures have been included in Note 13 Property, Plant and Equipment and Note 15 Goodwill
and Intangible Assets. There has not been a material impact in our assessment of useful economic lives and residual values of our
assets as a result of climate change. The Group continues to assess the potential long-term financial impacts of climate change.
Additional information on Brambles Climate Change Strategy and TCFD disclosures can be found on pages 20 to 22 of the
Annual Report.
On 28 November 2022, Brambles entered into an agreement to combine the pallet and automotive pooling operations of
CHEP China with Loscam (Greater China) Holdings Limited, with completion of the transaction taking place on
31 March 2023. As consideration Brambles received a 20% interest in the combined entity (Loscam China) which is accounted for
as an associate using the equity method (refer Note 8). Consequently, the results of CHEP China prior to the divestment date are
presented in discontinued operations in the consolidated statement of comprehensive income and all related note disclosures.
As at 30 June 2023, Brambles has net current liabilities of US1,543.5 million (2022: net current liabilities of US$915.4 million). The
increase in net current liabilities largely reflects the maturity of Euro Medium Term Note (EMTN) in June 2024. Liquidity remains
strong with US$2,051.7 million of available facilities (refer Note 23D) and US$160.7 million of total cash and cash equivalents.
Brambles continues to maintain solid investment-grade credit ratings of BBB+ from Standard & Poor’s and Baa1 from Moody’s
Investors Service (refer Note 23F).
The consolidated financial statements of Brambles include the assets, liabilities and results of Brambles Limited and all its
subsidiaries and associates. The consolidation process eliminates all intercompany accounts and transactions. The financial
statements of subsidiaries and associates are prepared using consistent accounting policies and for the same reporting period.
Changes for new accounting standards are incorporated in the financial statements of subsidiaries and associates.
The results of subsidiaries and associates acquired or disposed during the year are included in the consolidated statement of
comprehensive income from the effective date of acquisition or up to the effective date of disposal, as appropriate.
The trading results for business operations disposed during the year are disclosed separately as discontinued operations in the
consolidated statement of comprehensive income. The amount disclosed includes any gains or losses arising on disposal.
These financial statements present the consolidated results of Brambles Limited (ACN 118 896 021) (Company) and its subsidiaries
and associates (Brambles or the Group) for the year ended 30 June 2023. These financial statements have been authorised for issue
in accordance with a resolution of the Directors on 30 August 2023.
References to 2023 and 2022 are to the financial years ended 30 June 2023 and 30 June 2022, respectively. The financial statements
comply with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).
This general purpose financial report has been prepared in accordance with Australian Accounting Standards (AAS), other
authoritative pronouncements of the Australian Accounting Standards Board (AASB) and the requirements of the
Corporations Act 2001. It presents information on a historical cost basis, except for derivative financial instruments, financial assets
at fair value through profit or loss and adjustments for hyperinflation.
Comparative information has been reclassified where appropriate to enhance comparability.
78 Consolidated Financial Report Consolidated Financial Report 79
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 1. About This Report – continued
C) Presentation Currency
- a significant portion of Brambles' activity is denominated in US dollars; and
- the US dollar is widely understood by Australian and international investors and analysts.
D) Foreign Currency
A$:US$ €:US$ £:US$
2023 0.6750 1.0510 1.2110
2022 0.7223 1.1220 1.3264
30 June 2023 0.6615 1.0867 1.2614
30 June 2022 0.6879 1.0442 1.2124
E) Investments in Associates
F) Other Income and Other Revenue
Other income and other revenue include surcharges for fuel, lumber and transport, as well as net gains on disposal of property,
plant and equipment in the ordinary course of business. Fuel and transport surcharges are recognised when they are billed to the
customer, while lumber surcharges are deferred and recognised over the estimated period that the pooling equipment is utilised
by customers, referred to as the cycle time. The net gain on disposal is recognised when control of the asset has passed to the
buyer. Net gains on disposal also includes compensation for irrecoverable pooling equipment which is recognised when it is
received.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign
entity and translated at the closing rate. The principal exchange rates affecting Brambles were:
Items included in the financial statements of each of Brambles’ entities are measured using the functional currency of each entity.
Foreign currency transactions are translated into the functional currency of each entity using the exchange rates prevailing at the
dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions, and from the
translation at year end rates of monetary assets and liabilities denominated in foreign currencies, are recognised in profit or loss,
except where deferred in equity as qualifying cash flow hedges, qualifying net investment hedges or where they are attributable to
part of the net investment in foreign subsidiaries.
The results and cash flows of Brambles Limited and its subsidiaries and associates are translated into US dollars using the average
exchange rates for the period, calculated as the average end-of-month rates across the financial year except for subsidiaries in
hyperinflationary economies. Where this average is not a reasonable approximation of the cumulative effect of the rates prevailing
on the transaction dates, the exchange rate on the transaction date is used. The results of subsidiaries in hyperinflationary
economies are translated at the foreign exchange rate at balance sheet date instead of an average exchange rate for the period.
Assets and liabilities of Brambles Limited and its subsidiaries are translated into US dollars at the exchange rate ruling at the
balance sheet date.
Brambles uses the US dollar as its presentation currency because:
The share capital of Brambles Limited is translated into US dollars at historical rates. Exchange differences arising on the translation
of Brambles’ overseas and Australian entities are recognised as a separate component of equity.
Average
Year end
An associate is an arrangement in which Brambles has significant influence but not control or joint control. Associates are
accounted for using the equity method. Under this method the investment is initially recognised at cost and adjusted thereafter to
recognise the Group’s share of the post-acquisition profits or losses. Investments in associates are tested for impairment where an
indicator of impairment exists.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 1. About This Report – continued
G) Significant Items
-
-
H) Hyperinflationary Economies
The application of AASB 129 requires:
-
-
-
-
I) Critical Accounting Estimates and Judgements
- Income Tax (Note 5F)
- Property, Plant and Equipment (Note 13E)
- Irrecoverable Pooling Equipment Provision (IPEP) (Note 13D)
J) Changes to Accounting Standards
In applying its accounting policies, Brambles has made estimates and assumptions concerning the future which may differ from the
related actual outcomes.
Material estimates and judgements are found in the following notes:
At 30 June 2023, certain accounting standards and interpretations have been published or amended which will become mandatory
in future reporting periods. The International Sustainability Standards Board (ISSB) issued sustainability disclosure standards
IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-related Disclosures,
which will become effective for Brambles from 1 July 2024. Brambles will continue to evaluate the requirements in this area and
enhance its sustainability disclosures accordingly. Other new or amended accounting standards and interpretations are either not
material or not applicable to Brambles.
an adjustment of historical cost non-monetary assets and liabilities for the change in purchasing power caused by inflation from
the date of initial recognition to the balance sheet date;
an adjustment of the comprehensive income statement for inflation during the reporting period;
The impact arising from AASB 129 is a net charge of US$18.7 million recognised in the comprehensive income statement in 2023
(2022: US$22.0 million net charge). The US$18.7 million net charge relates to the hyperinflation impacts of US$9.8 million loss in
Türkiye, US$9.2 million loss in Argentina and a US$0.3 million gain in Zimbabwe.
the comprehensive income statement is translated at the foreign exchange rate at balance sheet date instead of an average
exchange rate for the period; and
Significant Items are items of income or expense which are, either individually or in aggregate, material to Brambles or to the
relevant business segment and:
outside the ordinary course of business (e.g. gains or losses on the sale or termination of operations, the cost of significant
reorganisations or restructuring); or
part of the ordinary activities of the business but unusual due to their size and nature.
Significant Items are disclosed to assist users of the financial statements to better understand Brambles’ business results.
an adjustment to be recognised in the comprehensive income statement to reflect the revaluation of monetary assets and
liabilities impacted by inflation during the reporting period.
AASB 129 Financial Reporting in Hyperinflationary Economies relates to Brambles' operations in Türkiye, Argentina and Zimbabwe,
which have been designated as hyperinflationary economies. The trigger for hyperinflation accounting is when the cumulative
inflation rate in an economy approaches or exceeds 100% over three successive years.
80 Consolidated Financial Report Consolidated Financial Report 81
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 2. Segment Information – Continuing Operations
- CHEP North America and Latin America (CHEP Americas);
- CHEP Europe, Middle East, Africa and India, including the North American automotive business (CHEP EMEA);
-
-
Brambles' segment information is provided on the same basis as internal management reporting to the CEO.
Segment sales revenue is measured on the same basis as the consolidated statement of comprehensive income. Brambles has one
revenue stream, which is the provision of pooling equipment to customers for a period of time. Several fees are charged to
customers including issue, transfer, transport and daily hire. The predominant billing structure for these fees is either a bundled
upfront fee upon issue of pooling equipment to customers, or a daily hire fee based on the number of days the pooling equipment
is used in the field by a customer. Other fees, such as transport and transfer fees, are billed when the activity occurs.
Brambles has four reportable segments:
Segment performance is measured on sales revenue, Underlying Profit, Cash Flow from Operations and Return on Capital Invested
(ROCI). Underlying Profit is the main measure of segment profit.
Segment sales revenue is allocated to segments based on product categories and physical location of the business unit that
invoices the customer. Intersegment revenue during the period was immaterial. There is no single external customer who
contributed more than 10% of Group sales revenue.
CHEP Australia, New Zealand and Asia, excluding India (CHEP Asia-Pacific); and
Corporate centre, including Shaping Our Future and share of results of associates (Corporate).
Assets and liabilities are measured consistently in segment reporting and in the consolidated balance sheet. Assets and liabilities
are allocated to segments based on segment use and physical location. Cash, borrowings and tax balances are managed centrally
and are not allocated to segments.
The services provided by Brambles are deemed a single performance obligation relating to the provision of an end-to-end pooling
solution and the performance obligation is satisfied over time. The issue and daily hire activities are not considered distinct
services. Revenue from issue activities is deferred and recognised over the estimated period that the pooling equipment is utilised
by customers, referred to as the cycle time, which is an output method. Revenue based on the daily hire model is also recognised
over time. Consideration that is fixed or highly probable is included in the transaction price allocated to the performance
obligation. This includes issue fees, daily hire fees and bundled upfront fees. Consideration that is variable or uncertain is
recognised when the activity occurs.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 2. Segment Information – Continuing Operations – continued
2023 2022 2023 2022
US$m US$m US$m US$m
By operating segment
CHEP Americas 3,371.0 2,950.8 463.5 185.3
CHEP EMEA 2,191.1 2,072.5 333.0 240.2
CHEP Asia-Pacific 514.7 496.5 150.1 144.2
Corporate - - (156.8) (177.9)
Continuing operations 6,076.8 5,519.8 789.8 391.8
By geographic origin
Americas 3,406.2 2,978.1
Europe 1,922.0 1,790.1
Australia 425.7 407.7
Other 322.9 343.9
Total 6,076.8 5,519.8
1
profit
2
Profit
3
2023 2022 2023 2022
US$m US$m US$m US$m
By operating segment
CHEP Americas 573.3 482.3 573.3 482.3
CHEP EMEA 506.5 461.2 506.5 461.2
CHEP Asia-Pacific 180.5 169.0 180.5 169.0
Corporate
4
(193.3) (182.5) (193.3) (182.5)
Continuing operations 1,067.0 930.0 1,067.0 930.0
Underlying Profit is equal to Operating profit in 2023 and 2022 as there are no Significant Items.
2
3
4
Operations
1
Sales
revenue
Cash Flow from
Cash Flow from Operations is a non-statutory measure and represents cash flow generated from operations after net capital
expenditure, but excluding Significant Items that are outside the ordinary course of business and discontinued operations.
Underlying
Operating profit is segment revenue less segment expense and excludes finance costs and tax.
Underlying Profit is a non-statutory profit measure and represents profit from continuing operations before finance costs,
hyperinflation adjustments, tax and Significant Items. It is presented to assist users of the consolidated financial statements to
better understand Brambles' business results.
The Corporate segment includes costs of US$110.6 million in 2023 relating to the Shaping Our Future project (2022:
US$108.6million), of which US$22.5 million relates to short-term transformation costs (2022: US$48.4 million), US$65.9 million
for digital transformation (2022: US$35.0 million) and US$22.2 million on remaining transformation initiatives, including
improving the customer experience and resources to support the delivery of the transformation programme (2022:
US$25.2million). The Corporate segment also includes the share of results of associates of US$4.7 million loss in 2023 (2022:
US$4.6 million loss) – refer Note 8.
Operating
82 Consolidated Financial Report Consolidated Financial Report 83
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 2. Segment Information – Continuing Operations – continued
Capital Invested
5
Invested
6
2023 2022 2023 2022
US$m US$m US$m US$m
By operating segment
CHEP Americas 18.9% 18.1% 3,033.3 2,659.9
CHEP EMEA 22.8% 23.2% 2,218.6 1,990.9
CHEP Asia-Pacific 34.0% 33.0% 530.4 512.7
Corporate (18.7) (13.0)
Continuing operations 18.5% 18.1% 5,763.6 5,150.5
5
6
expenditure
7
and amortisation
2023 2022 2023 2022
US$m US$m US$m US$m
By operating segment
CHEP Americas 904.2 981.2 398.9 361.0
CHEP EMEA 546.5 704.5 262.9 248.4
CHEP Asia-Pacific 116.1 101.2 63.8 64.8
Corporate 0.3 0.1 4.5 5.3
Continuing operations 1,567.1 1,787.0 730.1 679.5
7
Average CapitalReturn on
Return on Capital Invested (ROCI) is Underlying Profit divided by Average Capital Invested. ROCI is not calculated for the
Corporate segment since it is not an operating business unit. Corporate costs are included in the overall ROCI from continuing
operations. ROCI for continuing operations is impacted by the Shaping Our Future costs, which are included in the Corporate
segment (refer Note 2, footnote 4).
Average Capital Invested (ACI) is a 12-month average of capital invested. Capital invested is calculated as net assets before tax
balances, cash, borrowings and lease liabilities, but after adjustments for pension plan actuarial gains and losses and net
equity-settled share-based payments.
DepreciationCapital
Capital expenditure on property, plant and equipment is on an accruals basis.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 2. Segment Information – Continuing Operations – continued
Segment assets Segment liabilities
2023 2022 2023 2022
US$m US$m US$m US$m
By operating segment
CHEP Americas 4,540.6 4,121.4 1,918.1 1,720.9
CHEP EMEA 3,054.9 2,637.0 808.6 739.5
CHEP Asia-Pacific 674.0 622.9 269.9 248.4
Corporate 112.3 114.1 74.0 46.6
Continuing operations 8,381.8 7,495.4 3,070.6 2,755.4
Discontinued operations - 118.7 - 19.0
Total segment assets and liabilities 8,381.8 7,614.1 3,070.6 2,774.4
Cash and borrowings 160.7 158.2 2,154.9 2,162.1
Current tax balances 21.5 30.5 66.5 61.1
Deferred tax balances 154.5 128.9 556.5 483.0
Total assets and liabilities 8,718.5 7,931.7 5,848.5 5,480.6
Non-current assets by geographic origin
8
Americas 3,855.5 3,507.6
Europe 2,288.2 1,979.0
Australia 593.8 507.7
Other 381.6 486.9
Total 7,119.1 6,481.2
8
Non-current assets exclude deferred tax assets of US$154.5 million (2022: US$128.9 million).
84 Consolidated Financial Report Consolidated Financial Report 85
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 3. Operating Expenses – Continuing Operations
2023 2022
Note US$m US$m
Employment costs 985.1 863.1
Transport 1,445.6 1,396.9
Repairs and maintenance
1
1,274.7 1,200.8
Subcontractors and other service suppliers
2
454.8 388.4
Occupancy 56.9 48.4
Depreciation of property, plant and equipment 13 & 14 713.7 660.8
Impairment of property, plant and equipment 13 16.6 -
Irrecoverable pooling equipment provision expense 285.1 232.0
Amortisation of intangible assets 16.4 18.7
Net foreign exchange losses/(gains) 1.8 (0.8)
Other 73.3 64.6
5,324.0 4,872.9
1
2
Includes consulting costs and professional fees.
Includes the cost of raw materials used for repairs.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 4. Net Finance Costs – Continuing Operations
2023 2022
US$m US$m
Finance revenue
Bank accounts and short-term deposits 3.1 1.5
Derivative financial instruments 12.2 10.0
Other 0.7 -
16.0 11.5
Finance costs
Interest expense on bank loans and borrowings (73.1) (55.6)
Derivative financial instruments (26.5) (16.1)
Lease interest expense (29.3) (25.2)
Other (1.2) (0.9)
(130.1) (97.8)
Net finance costs (114.1) (86.3)
Finance costs are recognised as expenses in the year in which they are incurred.
Finance revenue is recognised as the interest accrues (using the effective interest method, which is the rate that exactly discounts
estimated future cash receipts through the expected life of the financial instrument to the net carrying amount of the financial
asset).
86 Consolidated Financial Report Consolidated Financial Report 87
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 5. Income Tax
2023 2022
Note US$m US$m
A) Components of Tax Expense
Amounts recognised in the statement of comprehensive income
Current income tax – continuing operations:
- income tax charge 231.6 198.9
- prior year adjustments (1.5) (20.3)
230.1 178.6
Deferred tax – continuing operations:
- origination and reversal of temporary differences 51.7 45.9
- previously unrecognised tax losses (2.2) (2.5)
- tax rate change 5.5 5.7
- prior year adjustments 2.0 20.2
57.0 69.3
Tax expense – continuing operations 287.1 247.9
Tax expense – discontinued operations 9 4.6 5.2
Tax expense recognised in comprehensive income 291.7 253.1
Amounts recognised in other comprehensive income
- on actuarial (loss)/gain on defined benefit pension plans (4.4) 5.7
Tax (benefit)/expense recognised directly in other comprehensive income (4.4) 5.7
Current and deferred tax attributable to other comprehensive income is recognised in equity.
The income tax expense or benefit for the year is the tax payable or receivable on the current year’s taxable income based on the
national income tax rate for each jurisdiction, adjusted by changes in deferred tax assets and liabilities attributable to temporary
differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements, and to unused tax
losses.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 5. Income Tax – continued
2023 2022
Note US$m US$m
B) Reconciliation Between Tax Expense and Accounting Profit Before Tax
Profit before tax – continuing operations 934.2 821.7
Tax at standard Australian rate of 30% (2022: 30%) 280.3 246.5
Effect of tax rates in other jurisdictions (39.5) (36.3)
Equity-accounted results of associates 1.4 1.4
Prior year adjustments 0.5 (0.1)
Current year tax losses not recognised 0.7 1.0
Foreign withholding tax unrecoverable 12.9 11.6
Change in tax rates 5.5 5.7
Non-deductible expenses 7.0 9.1
Prior year tax losses recouped/recognised (2.2) (2.5)
Hyperinflation adjustment 5.4 6.6
Other
1
15.1 4.9
Tax expense – continuing operations 287.1 247.9
Tax expense – discontinued operations 9 4.6 5.2
Total income tax expense 291.7 253.1
1
Assets Liabilities Assets Liabilities
C) Components of Deferred Tax Assets and Liabilities
Items recognised through the statement of comprehensive income
Employee benefits 33.4 - 27.7 -
Provisions and accruals 63.0 - 37.8 -
Losses available against future taxable income 187.6 - 210.9 -
Accelerated depreciation for tax purposes - (807.8) - (741.6)
Deferred revenue 135.3 - 114.3 -
Leases 200.2 (161.4) 196.2 (156.5)
Hyperinflation adjustment - (16.2) - (7.2)
Other 71.1 (123.6) 71.2 (113.2)
690.6 (1,109.0) 658.1 (1,018.5)
Items recognised in other comprehensive income or directly through equity
5.0 (1.0) 2.5 (1.2)
Share-based payments 12.4 - 5.0 -
17.4 (1.0) 7.5 (1.2)
Set-off against deferred tax (liabilities)/assets (553.5) 553.5 (536.7) 536.7
Net deferred tax assets/(liabilities) 154.5 (556.5) 128.9 (483.0)
Includes the impact of Base Erosion and Anti-abuse Tax (BEAT) in the US, relating to foreign payments.
Deferred tax assets and liabilities in the balance sheet are represented by cumulative temporary differences attributable to:
Actuarial losses/(gains) on defined benefit pension plans
US$m US$m
2023 2022
88 Consolidated Financial Report Consolidated Financial Report 89
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 5. Income Tax – continued
Assets Liabilities Assets Liabilities
D) Movements in Deferred Tax Assets and Liabilities
At 1 July 128.9 (483.0) 120.7 (410.1)
Credited/(charged) to profit or loss 28.7 (85.7) 35.2 (104.5)
Credited/(charged) directly to equity 6.9 0.3 (6.1) (0.2)
Divestment of subsidiaries (0.1) 0.2 - -
Hyperinflation adjustment - (9.0) - (6.0)
Offset against deferred tax (liabilities)/assets (16.8) 16.8 (10.5) 10.5
Foreign exchange differences 6.9 3.9 (10.4) 27.3
At 30 June 154.5 (556.5) 128.9 (483.0)
-
-
-
-
-
At reporting date, Brambles has unused tax losses of US$802.5 million (2022: US$939.0million) available for offset against future
profits. A deferred tax asset of US$187.6 million (2022: US$210.9 million) has been recognised in respect of US$752.0million (2022:
US$846.7million) of such losses.
Deferred tax is accounted for using the balance sheet liability method in respect of temporary differences between the carrying
amounts of assets and liabilities in the financial statements and the corresponding tax basis used in the computation of taxable
profit, calculated using tax rates which are enacted or substantively enacted by the balance sheet date.
Deferred tax assets and liabilities are not recognised:
where the deferred tax arises from the initial recognition of an asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; or
in respect of temporary differences associated with investments in subsidiaries and associates where the timing of the reversal
of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the
foreseeable future.
Deferred tax assets are recognised for carried forward tax losses to the extent that the entity has sufficient taxable temporary
differences or there is convincing evidence that sufficient taxable profit will be available against which the unused tax losses can be
utilised. The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no
longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax assets to be utilised.
The benefit for tax losses will only be obtained if:
Brambles derives future assessable income of a nature and of an amount sufficient to enable the benefit from the deductions
for the losses to be realised;
Brambles continues to comply with the conditions for deductibility imposed by tax legislation; and
no changes in tax legislation adversely affect Brambles in realising the benefit from the deductions for the losses.
No deferred tax asset has been recognised in respect of the remaining unused tax losses of US$50.5 million
(2022: US$92.3 million) due to uncertainty of future profit streams in the relevant jurisdictions. Tax losses of US$344.6million (2022:
US$431.1 million), which have been recognised in the balance sheet, have an expiry date between 2031 and 2038 (2022:between
2031 and 2038); however, it is expected that these losses will be recouped prior to expiry. The remaining tax losses of
US$407.4million (2022: US$415.6 million), which have been recognised in the balance sheet, can be carried forward indefinitely.
20222023
US$m US$m
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 5. Income Tax – continued
D) Movements in Deferred Tax Assets and Liabilities – continued
E) Tax Consolidation
F) Tax Estimates and Judgements
G) Tax Policy
In addition, Brambles regularly assesses the recognition and recoverability of deferred tax assets. This requires judgements about
the application of income tax legislation in jurisdictions in which Brambles operates. Changes in circumstances may alter
expectations and affect the carrying amount of deferred tax assets. The carrying amount of deferred tax assets is reviewed at each
balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all
or part of the deferred tax asset to be utilised.
Brambles Limited has a tax policy approved by the Board of Directors, which sets out the Company’s approach to tax risk
management and governance, tax planning, and dealing with tax authorities. The tax policy is included in Brambles Limited’s Code
of Conduct. In addition, Brambles Limited’s Sustainability Review includes a Tax Transparency Report, prepared in accordance with
the Australian Taxation Office's Voluntary Tax Transparency Code, which comprises, amongst other matters, details such as the
corporate income tax paid by, and effective tax rates of, Brambles' Australian and global operations. The 2023Tax Transparency
Report is scheduled for publication in the second half of calendar year 2023 and will be posted on Brambles’ website.
At reporting date, undistributed earnings of subsidiaries for which deferred tax liabilities have not been recognised in the
consolidated financial statements are US$885.2 million (2022: US$864.3million). No deferred tax liability has been recognised for
these amounts because Brambles controls the distributions from its subsidiaries and is satisfied that the temporary difference will
not reverse in the foreseeable future.
The majority of the deferred tax assets and liabilities are expected to be recovered/realised beyond 12 months after the balance
sheet date.
Brambles Limited and its Australian subsidiaries formed a tax consolidated group in 2006. Brambles Limited, as the head entity of
the tax consolidated group, and its Australian subsidiaries have entered into a tax sharing agreement in order to allocate income
tax expense. The tax sharing agreement uses a stand-alone basis of allocation. Consequently, Brambles Limited and its Australian
subsidiaries account for their own current and deferred tax amounts as if they each continue to be taxable entities in their own
right. In addition, the agreement provides funding rules setting out the basis upon which subsidiaries are to indemnify Brambles
Limited in respect of tax liabilities and the methodology by which subsidiaries in tax loss are to be compensated.
Brambles is a global group and is subject to income taxes in many jurisdictions around the world. Significant judgement is required
in determining the provision for income taxes on a worldwide basis. There are many transactions and calculations undertaken
during the ordinary course of business for which the ultimate tax determination is uncertain. Brambles recognises deferred tax
liabilities for uncertain tax positions in accordance with IFRS interpretation IFRIC 23. Where the final tax outcome of these matters
is different from amounts provided, such differences will impact the current and deferred tax provisions in the period in which such
outcome is determined.
Brambles has applied the mandatory exception from recognising and disclosing information regarding deferred tax assets and
liabilities related to OECD Pillar Two Global Anti-Base Erosion Rules.
90 Consolidated Financial Report Consolidated Financial Report 91
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 6. Earnings Per Share
2023 2022
US cents US cents
From continuing operations
- basic 46.6 40.5
- diluted 46.4 40.4
- basic, on Underlying Profit after finance costs and tax 48.0 42.1
From discontinued operations
- basic 4.1 1.4
- diluted 4.0 1.3
Total Earnings Per Share (EPS)
- basic 50.7 41.9
- diluted 50.4 41.7
Diluted EPS is calculated as net profit attributable to members of the parent entity, adjusted for:
-
-
-
Basic EPS is calculated as net profit attributable to members of the parent entity, adjusted to exclude costs of servicing equity
(other than dividends), divided by the weighted average number of ordinary shares.
Performance share rights and MyShare matching conditional rights granted under Brambles' share plans are considered to be
potential ordinary shares and have been included in the determination of diluted EPS to the extent they are considered to be
dilutive.
EPS on Underlying Profit after finance costs and tax is calculated as Underlying Profit after finance costs and tax attributable to
members of the parent entity, divided by the weighted average number of ordinary shares.
costs of servicing equity (other than dividends) and preference share dividends;
the after-tax effect of dividends and finance costs associated with dilutive potential ordinary shares that have been recognised
as expenses;
other non-discretionary changes in revenue or expenses during the year that would result from the dilution of potential
ordinary shares;
and divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus
element.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 6. Earnings Per Share – continued
2023 2022
Million Million
A) Weighted Average Number of Shares during the Year
Used in the calculation of basic EPS
1,388.0
1
1,415.7
Adjustment for share rights 6.2 5.5
Used in the calculation of diluted EPS 1,394.2 1,421.2
1
2023 2022
Note US$m US$m
Profit from continuing operations 647.1 573.8
Profit from discontinued operations 56.2 19.5
Profit used in calculating basic and diluted EPS 703.3 593.3
Underlying Profit after finance costs and tax
Underlying Profit 2 1,067.0 930.0
Net finance costs 4 (114.1) (86.3)
Underlying Profit after finance costs before tax 952.9 843.7
Tax expense on Underlying Profit (287.1) (247.9)
Underlying Profit after finance costs and tax 665.8 595.8
Which reconciles to statutory profit:
Underlying Profit after finance costs and tax 665.8 595.8
Net impact arising from hyperinflationary economies 1H (18.7) (22.0)
Profit from continuing operations 647.1 573.8
Statutory profit
B) Reconciliations of Profit used in EPS Calculations
The weighted average number of shares in 2023 decreased reflecting the impact of the share buy-back programme completed
in June 2022.
92 Consolidated Financial Report Consolidated Financial Report 93
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 7. Dividends
A) Dividends Paid during the Year
Interim Final
2023 2022
Dividend per share (US cents) 12.25 12.0
Dividends paid (US$ million) 164.2 154.4
Payment date 13 April 2023 13 October 2022
B) Dividend Declared after 30 June 2023
Final
2023
Dividend per share (US cents) 14.0
Estimated cost (US$ million) 194.5
Payment date 12 October 2023
Dividend record date 14 September 2023
C) Franking Credits
2023 2022
US$m US$m
73.6 67.6
The amounts above represent the balance of the franking account as at the end of the year, adjusted for:
-
franking credits that will arise from the payment of the current tax liability;
-
franking debits that will arise from the payment of dividends recognised as a liability at the reporting date;
-
franking credits that will arise from dividends recognised as receivable at the reporting date; and
-
franking credits that may be prevented from being distributed in subsequent financial years.
Total ordinary dividends declared for 2023 were 26.25 US cents per share, representing a payout ratio of 55% which is higher than
the prior year payout ratio of 53%. The 2022 total ordinary dividends were 22.75 US cents per share.
The final 2023 dividend will be franked at 35%.
As this dividend had not been declared at 30 June 2023, it is not reflected in these financial statements. A provision for dividends is
only recognised where the dividends have been declared prior to the reporting date.
Total dividends paid during the year of US$318.6 million (2022: US$304.8 million) per the consolidated cash flow statement differ
from the amount recognised in the consolidated statement of changes in equity of US$332.0 million (2022: US$299.7million) due
to the fluctuation in the Australian dollar between the dividend record and payment dates.
Franking credits available for subsequent financial years
Brambles' dividend policy targets a payout ratio of 45%–60% of Underlying Profit after finance costs and tax, subject to Brambles'
cash requirements, with the dividend per share declared in US cents and converted and paid in Australian cents based on an
average exchange rate five days prior to the dividend declaration.
The Dividend Reinvestment Plan (DRP) was reinstated in 2023. The impact of the DRP for the dividend payments made during the
year was neutralised by way of on-market share buy-backs.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 8. Investments in Associates
Name 2023 2022
Loscam China
1
20% -
MicroStar 16% 16%
1
2023 2022
US$m US$m
Share of results of associates recognised in comprehensive income
Loscam China 0.1 -
MicroStar (4.8) (4.6)
(4.7) (4.6)
Carrying value of investments in associates
Loscam China 119.0 -
MicroStar 37.9 44.6
156.9 44.6
Summarised financial information for Loscam China:
2023
US$m
Summarised balance sheet as at 30 June 2023
Total assets
446.9
Net assets
215.7
Summarised statement of comprehensive income for the three months ending 30 June 2023
Profit after tax
1.6
Brambles has investments in the following associates, which are accounted for using the equity method.
During the year, Brambles entered into an agreement to combine CHEP China with Loscam China - refer to Note 9 for further
disclosure relating to this transaction.
USA
% interest held at reporting date
Hong Kong
incorporation
Place of
94 Consolidated Financial Report Consolidated Financial Report 95
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 9. Discontinued Operations
At date of June
divestment 2022
US$m US$m
Assets
Cash and cash equivalents 8.5 12.7
Trade and other receivables 9.9 8.9
Inventories 6.5 6.8
Property, plant and equipment 94.9 102.2
Other assets
0.9 0.8
Total assets 120.7 131.4
Liabilities
Trade and other payables
25.7 17.2
Borrowings
51.8 48.5
Lease liabilities
0.2 0.6
Other liabilities
1.5 1.8
Total liabilities 79.2 68.1
Net Assets 41.5 63.3
On 28 November 2022, Brambles entered into an agreement to combine CHEP China with Loscam China, with completion of the
transaction taking place on 31 March 2023. Under the agreement, CHEP China was sold to Loscam (Greater China) Holdings
Limited for an enterprise value of US$113.0 million, with Loscam (Greater China) Holdings Limited issuing shares to Brambles as
consideration. Brambles has deconsolidated the net assets of CHEP China and recognised a 20% equity investment in Loscam
(Greater China) Holdings Limited at its fair value. The transaction resulted in a non-cash gain on divestment, being the difference
between the consideration and net assets disposed, net of transaction costs.
The carrying amount of CHEP China assets and liabilities at divestment date were:
The results of CHEP China up until the date of divestment and in the comparative period have been included within discontinued
operations in the consolidated statement of comprehensive income and all related note disclosures. The assets and liabilities of
CHEP China were divested at the completion of the merger and the comparative balance sheet and related notes remain
unchanged.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 9. Discontinued Operations – continued
2023 2022
US$m US$m
Operating results (excluding gain on divestment) relate to:
-
CHEP China
1
(4.2) -
-
gain on revaluation of First Reserve receivable
2
- 27.1
- other discontinued operations (0.5) (0.6)
Operating profit (4.7) 26.5
Gain on divestment of CHEP China
3
67.3 -
Net finance costs (1.8) (1.8)
Total profit before tax 60.8 24.7
Tax expense (4.6) (5.2)
Profit from discontinued operations 56.2 19.5
Net cash inflow from operating activities
4
40.4 0.2
Net cash outflow from investing activities
5
(19.9) (23.0)
Net cash inflow from financing activities
6
4.0 25.7
Net increase in cash and cash equivalents 24.5 2.9
1
2
3
4
5
6
Net cash outflow from investing activities in 2023 includes US$3.9 million of transaction costs paid and US$8.5 million of cash
disposed relating to the divestment of CHEP China. The remaining balance relates to CHEP China's net capital expenditure
(2022: the balance relates to CHEP China's net capital expenditure).
Net cash inflow from operating activities in 2023 includes US$41.5 million received from First Reserve as final settlement of the
receivable relating to the divestment of the Hoover Ferguson Group (HFG) investment in 2018.
CHEP China operating results include US$27.5 million of sales revenue (2022: US$39.1 million) and US$8.3 million of
depreciation charge (2022: US$12.4 million).
The revaluation gain on the deferred consideration receivable from First Reserve of US$27.1 million (US$22.0 million post tax)
was recognised as a Significant Item outside the ordinary course of business in 2022.
Financial information for discontinued operations is summarised below:
The gain on divestment of CHEP China is recognised as a Significant Item outside the ordinary course of business and includes
a profit of US$1.2 million relating to exchange differences released to profit (refer Note 22) and US$5.0 million of transaction
costs.
Net cash inflow from financing activities in 2023 and 2022 includes CHEP China's net proceeds from borrowings.
96 Consolidated Financial Report Consolidated Financial Report 97
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 10. Trade and Other Receivables
2023 2022
US$m US$m
Current
Trade receivables 772.4 675.3
Allowance for doubtful receivables (14.1) (16.2)
Net trade receivables 758.3 659.1
Other debtors 225.8 195.2
Unbilled revenue 142.3 124.2
Total trade and other receivables 1,126.4 978.5
Non-current
Other receivables
1
21.2 49.6
21.2 49.6
1
2023 includes a US$14.0 million non-current shareholder loan receivable from Loscam China. Other receivables in 2022 included
the US$41.5 million deferred consideration receivable from First Reserve relating to the divestment of the Hoover Ferguson
Group (HFG) investment in 2018, which was repaid on 5 August 2022.
The allowance for doubtful receivables has been established based on AASB 9 Financial Instruments. For all eligible trade and
other receivables, Brambles applies the simplified approach to measuring expected credit losses, which uses a lifetime expected
loss allowance.
Other debtors primarily comprise GST/VAT recoverable and loss compensation receivables.
Trade receivables with no significant financing component are recognised when services are provided and settlement is expected
within normal credit terms. Trade receivables are non-interest bearing and are generally on 30–90 day terms.
Other receivables are initially recognised at fair value plus any directly attributable transaction costs and subsequently measured at
amortised cost.
To measure the expected credit losses, trade and other receivables are grouped based on region and ageing. Customers with
heightened credit risk are provided for specifically based on historical default rates and forward-looking information, and
customers with normal credit risk are provided for in line with a provision matrix based on ageing and their associated risk. A
lifecycle allowance is calculated on the remaining trade and other receivables balance based on historical bad debt levels. Where
there is no reasonable expectation of recovery, balances are written off. Subsequent recovery of amounts previously written off are
credited against other expenses in the consolidated statement of comprehensive income.
An allowance for doubtful receivables of US$4.1million (2022:US$1.7million) has been recognised as an expense in line with the
Group's accounting policy.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 10. Trade and Other Receivables – continued
2023 2022 2023 2022
US$m US$m US$m US$m
At 30 June, the ageing analysis of trade receivables and other debtors by reference to due dates wasas follows:
Not past due 728.1 617.6 218.6 178.9
Past due 0–30 days, but not impaired 20.5 30.7 1.0 9.8
Past due 31–60 days, but not impaired 6.0 6.5 1.0 1.1
Past due 61–90 days, but not impaired 3.2 2.2 1.8 1.4
Past 90 days, but not impaired 0.5 2.1 3.4 4.0
Impaired 14.1 16.2 - -
772.4 675.3 225.8 195.2
Note 11. Inventories
2023 2022
US$m US$m
Raw materials and consumables 79.1 90.4
Finished goods 4.8 4.1
83.9 94.5
Note 12. Other Assets
2023 2022
US$m US$m
Current
Prepayments 50.0 56.3
Current tax receivable 21.5 30.5
Derivative financial instruments 2.4 3.6
73.9 90.4
Refer to Note 23 for other financial instrument disclosures.
Cost is determined on a weighted average basis and, where relevant, includes an appropriate portion of overhead expenditure. Net
realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and costs to
make the sale.
Trade receivables Other debtors
Refer to Note 23 for other financial instrument disclosures.
Inventories are valued at the lower of cost and net realisable value. Where appropriate, adjustments are made for hyperinflation
impacts and provisions are made for possible obsolescence.
98 Consolidated Financial Report Consolidated Financial Report 99
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 13. Property, Plant and Equipment
A) Net Carrying Amounts and Movements during the Year
Land and Plant and Land and Plant and
buildings equipment Total buildings equipment Total
Opening carrying amount 81.6 5,444.4 5,526.0 67.5 4,875.4 4,942.9
Additions
1
22.7 1,549.0 1,571.7 27.9 1,782.9 1,810.8
Divestment of subsidiaries - (94.7) (94.7) - - -
Disposals (1.2) (145.0) (146.2) (0.9) (153.1) (154.0)
Depreciation charge
2
(10.0) (585.2) (595.2) (7.7) (536.0) (543.7)
Impairment charge
3
- (16.6) (16.6) - - -
IPEP expense - (285.1) (285.1) - (232.0) (232.0)
Hyperinflation adjustment - 26.5 26.5 - 17.8 17.8
Foreign exchange differences (0.7) 76.3 75.6 (5.2) (310.6) (315.8)
Closing carrying amount 92.4 5,969.6 6,062.0 81.6 5,444.4 5,526.0
At 30 June
Cost 150.6 8,196.6 8,347.2 135.7 7,576.2 7,711.9
Accumulated depreciation
4
(58.2) (2,210.4) (2,268.6) (54.1) (2,131.8) (2,185.9)
Accumulated impairment
3
- (16.6) (16.6) - - -
Net carrying amount 92.4 5,969.6 6,062.0 81.6 5,444.4 5,526.0
1
In 2023, capital expenditure related to discontinued operations is US$4.6 million (2022: US$23.8 million).
2
In 2023, depreciation charge related to discontinued operations is US$7.9 million (2022: US$11.5 million).
3
4
Includes IPEP provision of US$124.2 million (2022: US$85.5 million).
B) Recognition and Measurement
2023 2022
US$m US$m
The net carrying amounts above include capital work in progress of US$137.9 million (2022:US$140.7million).
An impairment charge of US$16.6 million was recognised during the year relating to assets that are not expected to be fully
recovered.
Property, plant and equipment (PPE) is stated at cost, net of depreciation, any impairment and hyperinflation adjustments, except
land, which is shown at cost less impairment. Cost includes expenditure that is directly attributable to the acquisition of assets and,
where applicable, an initial estimate of the cost of dismantling and removing the item and restoring the site on which it is located.
Subsequent expenditure is capitalised only when it is probable that future economic benefits associated with the expenditure will
flow to Brambles. Repairs and maintenance are expensed in the consolidated statement of comprehensive income in the period
they are incurred.
PPE is derecognised upon disposal or when no future economic benefits are expected to arise from continued use of the asset. Any
net gain or loss arising on derecognition of the asset is included in the statement of comprehensive income and presented within
other income/operating expenses in the period in which the asset is derecognised.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 13. Property, Plant and Equipment – continued
C) Depreciation of Property, Plant and Equipment
- buildings: up to 50 years;
- pooling equipment: 5–10 years;
- other plant and equipment: 3–20 years.
D) Irrecoverable Pooling Equipment Provision
E) Recoverable Amount of Non-Current Assets
Brambles has also performed an assessment of its property, plant and equipment, including the service centre network, to consider
whether there are any indicators of material impairment arising from climate change related risks. There have been no impairments
identified as a result of climate change related risks as at reporting date; however, the Group continues to assess the potential
long-term financial impacts of climate change.
Where the carrying value of an asset exceeds its recoverable amount, the asset is considered to be impaired and is written down to
its recoverable amount. The impairment loss is recognised in the consolidated statement of comprehensive income in the
reporting period in which the write-down occurs.
Loss is an inherent risk of pooling equipment operations. Brambles’ pooling equipment operations around the world differ in terms
of business models, market dynamics, customer and distribution channel profiles, contractual arrangements and operational
details. Brambles monitors its pooling equipment operations using detailed key performance indicators (KPIs) and conducts audits
continually to confirm the existence and the condition of its pooling equipment assets and to validate its customer hire records.
During these audits, which take place at Brambles' plants, customer sites and other locations, pooling equipment is counted on a
sample basis and reconciled to the balances shown in Brambles’ customer hire records. The irrecoverable pooling equipment
provision (IPEP) is subject to a number of judgements and estimates, which are informed by historical statistical data in each
market, including the outcome of audits and relevant KPIs. IPEP provision is presented within accumulated depreciation in PPE.
At each reporting date, Brambles assesses whether there is any indication that an asset, or Cash Generating Unit (CGU) to which
the asset belongs, may be impaired. Where an indicator of impairment exists, Brambles makes a formal estimate of the recoverable
amount. The recoverable amount of goodwill is tested for impairment annually (refer Note 15D). The recoverable amount of an
asset is the greater of its fair value less costs to sell and its value in use.
Value in use is determined as 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.
The cost of improvements to leasehold properties is amortised over the unexpired portion of the lease, or the estimated useful life
of the improvements to Brambles, whichever is shorter.
Depreciation is recognised on a straight-line or reducing balance basis on all PPE (excluding land) over their expected useful lives.
The useful economic life and residual value of PPE is reviewed on an annual basis considering key assumptions, including forecast
usage, changes in technology, physical condition and potential climate change implications. No material changes have been
recognised in 2023 or 2022. The expected useful lives of PPE are generally:
The impact of climate change has been considered in relation to the useful economic lives and residual values of our assets. There
are no indicators of a change in the useful lives as a result of climate change at this time. Brambles will continue to monitor the
impact of climate change for any indicators of changes in asset lives or residual values.
100 Consolidated Financial Report Consolidated Financial Report 101
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 14. Right-of-Use Leased Assets
A) Net Carrying Amount and Movements during the Year
Total Total
Opening carrying amount 577.6 39.9 617.5 558.6 49.5 608.1
Additions 38.9 19.3 58.2 70.9 11.4 82.3
Divestment of subsidiaries (0.2) - (0.2) - - -
Remeasurement of existing leases 89.0 4.5 93.5 83.4 1.1 84.5
Depreciation charge
1
(107.3) (19.5) (126.8) (111.3) (18.2) (129.5)
Foreign exchange differences (5.3) 0.8 (4.5) (24.0) (3.9) (27.9)
Closing carrying amount 592.7 45.0 637.7 577.6 39.9 617.5
At 30 June
Cost
993.3 109.3 1,102.6 876.4 85.1 961.5
Accumulated depreciation
(400.6) (64.3) (464.9) (298.8) (45.2) (344.0)
Net carrying amount 592.7 45.0 637.7 577.6 39.9 617.5
1
In 2023, depreciation charge related to discontinued operations is US$0.4 million (2022: US$0.9 million).
B) Leases Exempt from AASB 16 Leases in Accordance with the Standard
2023 2022
US$m US$m
Short-term lease expense
2.8 6.0
Low-value assets lease expense
0.3 0.4
Exempt lease expense 3.1 6.4
2022
US$m
Plant and
equipment
2023
US$m
Land and
buildings
Plant and
equipment
The value of short-term lease commitments for 2024 is consistent with the 2023 short-term lease expense.
Land and
buildings
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 14. Right-of-Use Leased Assets – continued
C) Measurement of the Right-of-Use Leased Asset and Lease Liability
- fixed lease payments less any incentives receivable;
- variable payments based on a rate or index; and
-
Right-of-use leased assets are measured at cost comprising the following:
- the amount of the initial measurement of the lease liability;
- any lease payments made at or before the commencement date, less any lease incentives received;
- any initial direct costs; and
- dilapidation costs.
The right-of-use leased asset is depreciated on a straight-line basis from the commencement date to the earlier of the end of the
asset’s useful life or lease term.
The Group primarily leases offices, service centres, equipment and vehicles. Rental contracts are typically made for fixed periods,
but may have extension or termination options. Lease terms are negotiated on an individual basis and contain a range of different
terms and conditions.
Leases are recognised as a right-of-use leased asset and a corresponding lease liability at the date the leased asset is available for
use by the Group. Principal and interest payments are reflected in the consolidated cash flow statement as financing and operating
activities, respectively.
The Group is required to remeasure the lease liability and make an adjustment to the right-of-use leased asset if the lease terms
and conditions are modified, in which case the lease liability is remeasured by discounting the revised lease payments. The
remeasurement of the lease liability is also applied against the right-of-use leased asset.
Assets and liabilities arising from a lease are initially measured at present value. Lease liabilities include the present value of:
Lease payments are discounted using the incremental borrowing rate calculated by geographic region. The incremental borrowing
rate is the rate the lessee would have to pay to borrow the funds necessary to obtain an asset of similar value in a similar economic
environment with similar terms and conditions.
amounts expected to be payable relating to residual value guarantees, early termination penalties, and purchase options if
reasonably certain of taking place.
102 Consolidated Financial Report Consolidated Financial Report 103
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 15. Goodwill and Intangible Assets
A) Net Carrying Amounts and Movements during the Year
Goodwill Software
Other
1
Total Goodwill Software
Other
1
Total
Opening carrying amount 184.1 42.2 17.2 243.5 207.8 40.1 23.3 271.2
Additions - 9.2 3.5 12.7 - 14.6 3.0 17.6
Disposals - - (1.5) (1.5) - (0.9) - (0.9)
Divestment of subsidiaries - (0.2) - (0.2) - - - -
Amortisation charge - (10.3) (6.1) (16.4) - (11.6) (7.1) (18.7)
3.4 - (0.2) 3.2 (23.7) - (2.0) (25.7)
Closing carrying amount 187.5 40.9 12.9 241.3 184.1 42.2 17.2 243.5
At 30 June
Gross carrying amount 187.5 158.7 76.2 422.4 184.1 192.9 74.6 451.6
Accumulated amortisation - (117.8) (63.3) (181.1) - (150.7) (57.4) (208.1)
Net carrying amount 187.5 40.9 12.9 241.3 184.1 42.2 17.2 243.5
1
Other intangible assets primarily comprises product development costs.
Foreign exchange differences
2023 2022
US$m US$m
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 15. Goodwill and Intangible Assets – continued
B) Summary of Carrying Value of Goodwill by CGU
CHEP Europe
CHEP Asia-Pacific
CHEP Americas
1
Total goodwill
1
A formal impairment assessment is not undertaken for the CHEP Americas CGU goodwill on the basis of materiality.
C) Recognition and Measurement
Goodwill
Other intangible assets
- customer lists and relationships: 3–10 years; and
- computer software: 3–10 years.
50.4
10.4
187.5
121.8
52.1
10.2
184.1
2023
US$m
2022
US$m
126.7
The expected useful lives of intangible assets are generally:
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds
and the carrying amount of the asset and are recognised in the consolidated statement of comprehensive income when the asset
is derecognised.
Useful lives have been established for all non-goodwill intangible assets. Amortisation charges are expensed in the consolidated
statement of comprehensive income on a straight-line basis over those useful lives. Estimated useful lives are reviewed annually.
There are no non-goodwill intangible assets with indefinite lives.
Intangible assets are tested for impairment where an indicator of impairment exists, either individually or at the CGU level.
The costs of acquiring computer software for internal use are capitalised as intangible assets where it is used to support a
significant business system and the expenditure leads to the creation of an asset. In Software as a Service (SaaS) arrangements,
implementation costs are capitalised if the implementation activities create an intangible asset that Brambles controls and the
intangible asset meets the recognition criteria.
Goodwill represents the excess of the cost of an acquisition over the fair value of Brambles’ share of the net identifiable assets of
the acquired subsidiary or associate at the date of acquisition. Goodwill on acquisitions of subsidiaries and associates is included in
intangible assets and investments in associates, respectively. Goodwill is carried at cost less accumulated impairment losses and is
not amortised.
Upon acquisition, any goodwill arising is allocated to each CGU expected to benefit from the acquisition. On disposal of an
operation, goodwill associated with the disposed operation is included in the carrying amount of the operation when determining
the gain or loss on disposal.
Intangible assets acquired are capitalised at cost, unless acquired as part of a business combination, in which case they are
capitalised at fair value as at the date of acquisition. Following initial recognition, intangible assets are carried at cost less
provisions for amortisation and impairment.
104 Consolidated Financial Report Consolidated Financial Report 105
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 15. Goodwill and Intangible Assets – continued
D) Goodwill Recoverable Amount Testing
Cash flow forecasts
Revenue growth rates
Terminal value
Discount rates
Sensitivity
Brambles’ business units undertake an impairment review process annually to ensure that goodwill balances are not carried at
amounts that are in excess of their recoverable amounts. This review may be undertaken more frequently if events or changes
indicate that goodwill may be impaired.
The recoverable amount of goodwill is determined based on the higher of the value in use and the fair value less costs to sell
calculations undertaken at the CGU level. The value in use is calculated using a discounted cash flow methodology covering a four-
year period, with an appropriate terminal value at the end of that period.
The terminal value calculated is determined using the stable growth model, having regard to the weighted average cost of capital
(WACC) and terminal growth rate appropriate to each CGU. The terminal growth rate used in the financial projections was 1.5% for
CHEP Europe and 2.4% for CHEP Asia-Pacific.
Discount rates used for the purposes of impairment testing (as required by AASB 136 Impairment of Assets) are post-tax WACC
and include a premium for market risks appropriate to each country in which the CGU operates. Pre-tax WACC is derived based on
the effective tax rate for the purpose of disclosure. Weighted average pre-tax WACC used was 8.8% (pre-tax rates: CHEPEurope
8.6% and CHEP Asia-Pacific 9.7%).
Downside scenarios were prepared to sensitise the models and any reasonable change to the above key assumptions would not
cause the carrying value to materially exceed the recoverable amount.
Cash flow forecasts are post-tax and based on the most recent financial projections covering a maximum period of four years.
Financial projections are based on assumptions that represent management’s best estimates.
Revenue growth rates used are based on management’s latest four-year plan. Four-year growth rates for CHEP Europe and
CHEPAsia-Pacific CGUs were 6.3% and 5.5%, respectively. Sensitivity testing was performed on these CGUs and a reasonable
change in these rates would not cause the carrying value of the CGUs to exceed their recoverable amount.
Based on the impairment testing, the carrying amount of goodwill in the CGUs at reporting date was fully supported. The key
assumptions on which management has based its cash flow projections were:
Consideration has been given to the potential financial impacts of climate change related risks on the carrying value of goodwill.
Brambles' forecast cashflows includes the costs of achieving its 2025 sustainability targets as set out in pages 18 to 19 of the
Annual Report. Potential long-term financial impacts of climate change, including the cost of reaching our net-zero target in 2040,
are continuing to be assessed; however, at this stage we do not consider the potential impacts of climate change to present a risk
of impairment to the carrying value of goodwill.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 16. Trade and Other Payables
2023 2022
US$m US$m
Current
Trade payables 626.1 549.7
Other payables 497.7 518.7
Deferred revenue 579.4 476.8
Accruals 362.6 307.0
Derivative financial instruments 9.1 7.9
Total trade and other payables 2,074.9 1,860.1
Non-current
Other liabilities - derivative financial instruments - 0.8
- 0.8
Note 17. Provisions
Current Non-current Current Non-current
Employee entitlements 143.4 7.1 108.0 7.7
Other
1
31.3 68.2 14.1 68.1
174.7 75.3 122.1 75.8
1
Movements in each class of provision during the year are set out below:
Employee
entitlements Other Total
US$m US$m US$m
Carrying amount at 1 July 2022 115.7 82.2 197.9
Additional provisions:
- charged to profit or loss 132.1 14.0 146.1
- recognised for dilapidation and other provisions - 8.0 8.0
Amounts utilised (93.6) (3.2) (96.8)
Divestment of subsidiaries (0.9) (0.2) (1.1)
Foreign exchange differences (2.8) (1.3) (4.1)
Carrying amount at 30 June 2023 150.5 99.5 250.0
Other includes US$68.2 million relating to dilapidation provisions on leases (2022: US$67.1 million), as well as other provisions
relating to litigation and other known exposures.
2023 2022
US$m US$m
Trade payables represent liabilities for goods and services provided to Brambles prior to the end of the financial year that remain
unpaid at the reporting date. The amounts are unsecured, non-interest bearing and are paid within normal credit terms of 30–150
days.
Refer to Note 23 for other financial instrument disclosures.
Other payables include capital expenditure creditors and GST/VAT payable. Other payables (excluding derivatives) are initially
measured at fair value, net of transaction costs incurred, and subsequently measured at amortised cost.
Deferred revenue primarily relates to revenue that is billed on issue of pooling equipment to customers. It is recognised in the
consolidated statement of comprehensive income over the cycle time (refer Note 2). As the cycle time is less than one year, all
deferred revenue from 2022 was recognised in 2023. Deferred revenue in 2023 relates to the transaction price allocated to
performance obligations that remain unsatisfied and will be satisfied in 2024.
106 Consolidated Financial Report Consolidated Financial Report 107
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 17. Provisions – continued
Note 18. Borrowings
Current Non-current Current Non-current
Unsecured
Bank overdrafts 4.1 - 2.3 -
Bank loans 4.0 14.1 43.2 568.8
Loan notes 554.0 1,578.7 8.2 1,539.6
562.1 1,592.8 53.7 2,108.4
Note 19. Retirement Benefit Obligations
A) Defined Contribution Plans
Financial risks and risk management strategies associated with borrowings, including financial covenants, are disclosed in Note23.
Liabilities for annual leave, as well as those employee entitlements that are expected to be settled within one year, are measured at
the amounts expected to be paid when they are settled. All other employee entitlement liabilities are measured at the estimated
present value of the future cash outflows to be made in respect of services provided by employees up to the reporting date. Future
cash outflows are discounted using the applicable corporate bond rates.
Employee entitlements are classified as current liabilities unless Brambles has an unconditional right to defer settlement of the
liability for at least 12 months after the balance sheet date.
2023 2022
US$m US$m
Brambles operates a number of defined contribution retirement benefit plans for qualifying employees. The assets of these plans
are held in separately administered trusts or insurance policies. In some countries, Brambles’ employees are members of state-
managed retirement benefit plans. Brambles is required to contribute a specified percentage of payroll costs to the retirement
benefit plan to fund benefits. The only obligation of Brambles with respect to defined contribution retirement benefit plans is to
make the specified contributions. Payments to defined contribution retirement benefit plans are charged as an expense as they fall
due.
Borrowings are primarily initially recognised at fair value net of transaction costs incurred and are subsequently measured at
amortised cost. Any difference between the borrowing proceeds (net of transaction costs) and the redemption amount is
recognised in the consolidated statement of comprehensive income over the period of the borrowings using the effective interest
method.
Borrowings are classified as current liabilities unless Brambles has an unconditional right to defer settlement of the liability for at
least 12 months after the balance sheet date.
Employee entitlements are provided by Brambles in accordance with the legal and social requirements of the country of
employment. Principal entitlements are for annual leave, sick leave, long service leave, bonuses and contract entitlements. Annual
leave and sick leave entitlements are presented within trade and other payables.
US$28.6 million (2022: US$27.9 million) has been recognised as an expense in the consolidated statement of comprehensive
income, representing contributions paid and payable to these plans by Brambles at rates specified in the rules of the plans, all of
which relate to continuing operations.
Provisions for liabilities are made on the basis that, due to a past event, the business has a constructive or legal obligation to
transfer economic benefits that are of uncertain timing or amount. Provisions are measured at the present value of management’s
best estimate at the balance sheet date of the expenditure required to settle the obligation. The discount rate used is a pre-tax rate
that reflects current market assessments of the time value of money and the risks appropriate to the liability.
Where discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost in the
consolidated statement of comprehensive income.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 19. Retirement Benefit Obligations – continued
B) Defined Benefit Plans
The amounts recognised in the balance sheet are as follows:
2023 2022
US$m US$m
Present value of defined benefit obligations 194.7 226.3
Fair value of plan assets (178.4) (224.1)
Net liability recognised in the balance sheet 16.3 2.2
Brambles has no legal obligation to settle this liability with an immediate contribution or additional one-off contributions.
Brambles intends to continue to make contributions to the plans at the rates recommended by the plans’ actuaries when actuarial
valuations are obtained. Annual contributions of £5.0 million or US$6.3 million (2022: £5.0 million or US$6.1million) are being paid
to remove the identified deficits over a period of up to five years (2022: six years).
Brambles operates a small number of defined benefit pension plans, which are closed to new entrants. The majority of the plans
are self-administered and the plans’ assets are held independently of Brambles’ finances. Under the plans, members are entitled to
retirement benefits based upon a percentage of final salary. No other post-retirement benefits are provided. The plans are mostly
funded plans.
The plans' assets and the present value of the defined benefit obligations recognised in Brambles’ balance sheet are based upon
the most recent formal actuarial valuations, which have been updated to 30 June 2023 by independent professionally qualified
actuaries and take account of the requirements of AASB 119 Employee Benefits. For all plans, the valuation updates have used
assumptions, assets and cash flows as at 31 May 2023. There has been no material change in assumptions, assets and cash flows
between 31May and 30 June. The present value of the defined benefit obligations and past service costs were measured using the
projected unit credit method. Past service cost is recognised immediately to the extent that the benefits are already vested.
A net expense of US$2.2 million has been recognised in the consolidated statement of comprehensive income in respect of defined
benefit plans (2022: US$1.8 million), of which US$1.6 million net expense relates to continuing operations (2022: US$1.1million).
Included within the total expense recognised during the year is a net interest income of US$0.3 million (2022: nil).
A decline in asset values, an increase in the discount rate and currency variations were the key drivers for the changes in the
present value of defined benefit obligations and the fair value of plan assets. Benefits paid during the period were US$10.7 million
(2022: US$8.5million). There are a number of principal assumptions used in the actuarial valuations of the defined benefit
obligations. These principal assumptions are the discount rate of 5.25% (2022: 3.80%) for the plans operating in the United
Kingdom and 12.11% (2022: 10.24%) for the South African plan; the pension increase rate of 3.15%–3.70% (2022: 3.30%–3.65%) in
the United Kingdom plans, and the inflation rate for the South African plan of 7.47% (2022: 6.54%). A change of 25 basis points in
the discount rate or other key assumptions may have a material impact on the defined benefit obligation.
A liability in respect of defined benefit pension plans is recognised in the balance sheet, measured as the present value of the
defined benefit obligation at the reporting date less the fair value of the pension plans' assets at that date. Pension obligations are
measured as the present value of estimated future cash flows discounted at rates reflecting the yields of high quality corporate
bonds.
Actuarial gains and losses arising from differences between expected and actual returns, and the effect of changes in actuarial
assumptions are recognised in full through other comprehensive income in the period in which they arise. In 2023, a net actuarial
loss of US$17.4 million was recognised in other comprehensive income (2022: net actuarial gain of US$22.5 million).
108 Consolidated Financial Report Consolidated Financial Report 109
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 20. Contributed Equity
Shares US$m
Total ordinary shares, of no par value, issued and fully paid:
At 1 July 2021 1,441,169,689 4,924.8
Issued during the year
1
3,290,746 24.9
Share buy-back
2
(58,305,186) (443.9)
At 30 June 2022 1,386,155,249 4,505.8
At 1 July 2022 1,386,155,249 4,505.8
Issued during the year
1
3,148,807 25.8
At 30 June 2023 1,389,304,056 4,531.6
1
2
Ordinary shares of Brambles Limited entitle the holder to participate in dividends and the proceeds on any winding up of the
Company in proportion to the number of shares held.
Ordinary shares are classified as contributed equity. No gain or loss is recognised in the consolidated statement of comprehensive
income on the purchase, sale, issue or cancellation of Brambles’ own equity instruments.
The on-market share buy-back announced on 25 February 2019 was completed during 2022. Proceeds from the IFCO
divestment were used to repurchase and cancel a total of US$1.67 billion of shares, representing 13.6% of issued share capital
at the commencement of the programme in June 2019.
Includes shares issued on exercise of share rights granted under employee share plans and dividend shares issued under those
plans.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction from the proceeds
of issue.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 21. Share-Based Payments
A) Grants Over Brambles Limited Shares
Granted Exercised Forfeited /
Balance during during lapsed Balance
Grant date
Ex
p
ir
y
date
at 1 Jul
y
y
ear
y
ear during year at 30 June
2023
Performance share rights
Granted in prior periods 6,880,287 - (1,922,359) (645,142) 4,312,786
18 Aug 2022 18 Aug 2028 - 9,558 - - 9,558
15 Sept 2022 15 Sept 2028 - 13,768 (13,768) - -
21 Oct 2022 21 Oct 2028 - 3,288,835 (21,289) (10,826) 3,256,720
31 Jan 2023 31 Jan 2029 - 2,599 - - 2,599
31 May 2023 31 May 2029 - 975 - - 975
1 June 2023 1 June 2029 - 14,000 - - 14,000
MyShare matching conditional rights
2021 Plan Year 31 Mar 2023 1,375,661 - (1,298,540) (77,121) -
2022 Plan Year 31 Mar 2024 537,056 993,816 (83,721) (124,659) 1,322,492
2023 Plan Year 31 Mar 2025 - 470,248 (9,648) (9,765) 450,835
Total rights 8,793,004 4,793,799 (3,349,325) (867,513) 9,369,965
2022 (summarised comparative)
Total rights 8,142,946 4,841,811 (3,365,858) (825,895) 8,793,004
Of the above grants, 192,123 were exercisable at 30 June 2023.
2023 2022
Weighted average data:
- fair value at grant date of grants made during the year A$ 10.68 9.37
- share price at exercise date of grants exercised during the year A$ 12.41 10.39
- remaining contractual life at 30 June Years 3.9 3.8
The Remuneration Report sets out details relating to the Brambles share plans (pages 64 and 66), together with details of
performance share rights and MyShare matching conditional rights issued to the Executive Directors and other Key Management
Personnel (pages 65 to 66). Rights granted by Brambles do not result in an entitlement to participate in share issues of any other
corporation.
Set out below are summaries of rights granted under the plans.
The cost of equity-settled share rights is recognised, together with a corresponding increase in equity, over the period in which the
performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award
(vesting date).
110 Consolidated Financial Report Consolidated Financial Report 111
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 21. Share-Based Payments – continued
A) Grants Over Brambles Limited Shares – continued
B) Fair Value Calculations
The significant inputs into the valuation models for the grants made during the year were the following:
2023 2022
Weighted average share price A$11.60 A$10.39
Expected volatility 25% 25%
Expected life 2–3 years 2–3 years
Annual risk-free interest rate 3.75% 0.64%
Expected dividend yield 3.11% 2.83%
C) Share-Based Payments Expense
Brambles recognised a total expense of US$27.5 million (2022: US$28.3 million) relating to equity-settled share-based payments
and US$2.5 million (2022: US$2.3 million) relating to cash-settled share-based payments. Of the equity-settled amount,
US$0.9million (2022:US$0.6 million) related to discontinued operations.
The fair value of share rights subject to a market condition is determined at grant date using a Monte Carlo Simulation. The fair
value of share rights subject to a non-market condition is determined at grant date using a risk-neutral assumption. The values
calculated do not take into account the probability of rights being forfeited prior to vesting, as Brambles revises its estimate of the
number of share rights expected to vest at each reporting date.
The expected volatility was determined based on a three-year historic volatility of Brambles’ share prices.
Executives and employees in certain jurisdictions are provided cash incentives calculated by reference to the awards under the
share-based compensation schemes (phantom shares). These phantom shares are fair valued on initial grant date and at each
subsequent reporting date.
The cost of cash-settled share rights is charged to the consolidated statement of comprehensive income over the relevant vesting
periods, with a corresponding increase in provisions.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 22. Reserves and Retained Earnings
A) Movements in Reserves and Retained Earnings
Share- Foreign
based currency Retained
payments translation Other Total earnings
US$m US$m US$m US$m US$m US$m
Year ended 30 June 2022
Opening balance as at 1 July 2021 71.7 (345.9) (7,162.4) 190.2 (7,246.4) 5,011.5
Actuarial gain on defined benefit plans - - - - - 16.8
Foreign exchange differences - (167.3) - - (167.3) -
Revaluation of reserves relating to hyperinflation - - - 34.0 34.0 -
Share-based payments:
- expense recognised 28.3 - - - 28.3 -
- shares issued (24.9) - - - (24.9) -
- equity component of related tax (0.3) - - - (0.3) -
Dividends declared
- - - - - (299.7)
Profit for the year - - - - - 593.3
Closing balance as at 30 June 2022 74.8 (513.2) (7,162.4) 224.2 (7,376.6) 5,321.9
Year ended 30 June 2023
Opening balance as at 1 July 2022 74.8 (513.2) (7,162.4) 224.2 (7,376.6) 5,321.9
Actuarial loss on defined benefit plans - - - - - (13.0)
Foreign exchange differences - (5.4) - - (5.4) -
FCTR released to profit on divestment of CHEP China - (1.2) - - (1.2) -
- - - 36.2 36.2 -
Share-based payments:
- expense recognised 27.5 - - - 27.5 -
- shares issued (25.8) - - - (25.8) -
- equity component of related tax 3.5 - - - 3.5 -
Dividends declared - - - - - (332.0)
Profit for the year - - - - - 703.3
Closing balance as at 30 June 2023 80.0 (519.8) (7,162.4) 260.4 (7,341.8) 5,680.2
Reserves
Unification
Revaluation of reserves relating to hyperinflation
112 Consolidated Financial Report Consolidated Financial Report 113
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 22. Reserves and Retained Earnings – continued
B) Nature and Purpose of Reserves
Foreign currency translation reserve
Unification reserve
Other
Unification refers to the amalgamation of Brambles Industries Limited (BIL) and Brambles Industries plc (BIP) to form a new entity
Brambles Limited. The Unification reserve of US$15,385.8 million was established on 4 December 2006, representing the difference
between the Brambles Limited share capital measured at fair value and the carrying value of the share capital of BIL and BIP at that
date. Subsequently on 9 September 2011, the reduction in share capital of US$8,223.4 million by BramblesLimited in accordance
with section 258F of the Corporations Act 2001 was applied against the Unification reserve.
This comprises the merger reserve created at the time of the formation of the Dual Listed Company structure in 2001, the hedging
reserve and the hyperinflation reserve. The hedging reserve represents the cumulative portion of the gain or loss of cash flow
hedges that are determined to be effective hedges. Amounts are recognised in the statement of comprehensive income when the
associated hedged transaction is recognised or the hedge or the forecast hedged transaction is no longer highly probable. The
hyperinflation reserve represents the revaluation of equity in hyperinflationary economies and any gains or losses are recognised
directly in the reserve.
Share-based payments reserve
This comprises the cumulative share-based payment expense recognised in the statement of comprehensive income in relation to
equity-settled options and share rights issued but not yet exercised. Refer to Note 21 for further details.
This comprises cumulative exchange differences arising from the translation of the financial statements of foreign subsidiaries and
associates, net of qualifying net investment hedges. The relevant accumulated balance is recognised in the consolidated statement
of comprehensive income on disposal of a foreign subsidiary or associate.
Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2023
Note 23. Financial Risk Management
A) Financial Assets and Liabilities
B) Derivative and Hedging Activities
Brambles is exposed to a variety of financial risks: market risk (including the effect of fluctuations in interest rates and exchange
rates), liquidity risk and credit risk.
Brambles’ overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise
potential adverse effects on the financial performance of Brambles. Financial risk management activities are carried out centrally by
Brambles’ treasury function in accordance with Board policies and guidelines, through standard operating procedures and
delegated authorities.
Brambles uses interest rate swaps and forward foreign exchange contracts to manage its market risk and does not trade in financial
instruments for speculative purposes.
The fair values of all financial assets and liabilities held on the balance sheet as at 30 June 2023 equal the carrying amount, with the
exception of loan notes, which have an estimated fair value of US$2,055.2 million (2022: US$1,491.7 million) compared to a carrying
value of US$2,132.7 million (2022: US$1,547.8 million). Financial assets and liabilities held at fair value (other than loan notes) are
estimated using Level 2 estimation techniques, which use inputs that are observable for the asset or liability, either directly (as
prices) or indirectly (derived from prices). The fair value of loan notes has been calculated using Level 1 valuation techniques, which
use directly observable unadjusted quoted prices in active markets for identical assets or liabilities.
Financial assets are recognised when Brambles becomes a party to the contractual provisions of the instrument and are classified
in the following two categories: financial assets at fair value through profit or loss; and amortised cost, as disclosed in the
respective notes.
Derecognition occurs when rights to the asset have expired or when Brambles transfers its rights to receive cash flows from the
asset together with substantially all the risks and rewards of the asset.
Refer to Note 18 for the recognition of interest bearing financial liabilities.
The fair value of forward exchange contracts is calculated by reference to current forward exchange rates for contracts with similar
maturities at the balance sheet date. The fair value of interest rate swap contracts is calculated as the present value of the forward
cash flows of the instrument after applying market rates and standard valuation techniques.
Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated or exercised, or no longer qualifies
for hedge accounting.
For the purposes of hedge accounting, hedges are classified as either fair value hedges, cash flow hedges or net investment
hedges.
For fair value hedges, any gain or loss from remeasuring the hedging instrument at fair value is adjusted against the carrying
amount of the hedged item and recognised in profit or loss.
For cash flow hedges, the portion of the gain or loss on the hedging instrument that is determined to be an effective hedge is
recognised in other comprehensive income and the ineffective portion is recognised in profit or loss.
Hedges for net investments in foreign operations are accounted for similarly to cash flow hedges.
114 Consolidated Financial Report Consolidated Financial Report 115
Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2023
Note 23. Financial Risk Management – continued
C) Market Risk
2023 2022
Note US$m US$m
Financial assets (floating rate)
Cash at bank 24 139.3 148.1
Short-term deposits 24 21.4 10.1
160.7 158.2
Weighted average effective interest rate at 30 June 1.0% 0.6%
Financial assets (fixed rate)
Other receivables 10 21.2 49.6
Weighted average effective interest rate at 30 June 4.7% 6.0%
Financial liabilities (floating rate)
Bank overdrafts 18 4.1 2.3
Bank loans
1
18 18.1 611.5
Interest rate swaps (notional value) – fair value hedges 163.0 156.6
Net exposure to cash flow interest rate risk 185.2 770.4
Weighted average effective interest rate at 30 June 7.5% 1.5%
Financial liabilities (fixed rate)
Loan notes 18 2,132.7 1,547.8
Bank loans 18 - 0.5
Lease liabilities 24C 729.4 713.4
Interest rate swaps (notional value) – fair value hedges (163.0) (156.6)
Net exposure to fair value interest rate risk 2,699.1 2,105.1
Weighted average effective interest rate at 30 June 3.4% 3.0%
1
Brambles has the following risk policies in place with respect to market risk.
Bank loans in 2023 primarily consist of regional borrowings where local rules and regulations restrict intercompany lending.
Regional borrowings have a higher weighting in 2023 due to nil bank loans held by central financing entities at 30 June 2023.
Interest rate risk
Brambles’ exposure to potential volatility in finance costs is predominantly in Euros and US dollars on borrowings. This is managed
by maintaining a mix of fixed and floating-rate instruments within select target bands over defined periods. In some cases, interest
rate derivatives are used to achieve these targets synthetically.
The following table sets out the financial instruments exposed to interest rate risk at reporting date:
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 23. Financial Risk Management – continued
C) Market Risk – continued
Interest rate swaps – fair value hedges
€150m interest rate swaps
163.0 163.0
161.9 (4.0)
(3.6) (3.4)
Nil 0.2
Other payables
—
Sensitivity analysis
Foreign exchange risk
Brambles entered into interest rate swap transactions with various banks, swapping €150.0 million of the €500.0 million fixed-rate
2024 Euro Medium Term Note (EMTN) to variable rates. The interest rate swaps and debt have been designated in a hedging
relationship at a hedge ratio of 1:1. The fair value of the interest rate swaps is adjusted for credit risk, measured by reference to
credit default swaps for the interest rate swap counterparties, which is a source of ineffectiveness. Movement in credit risk does not
dominate the hedge relationship. The credit valuation adjustment to the swaps at 30 June 2023 is nil (2022:nil).
The terms of the swaps match the terms of the fixed-rate bond issue for the amounts and durations being hedged.
The gain or loss from remeasuring the interest rate swaps at fair value is recorded in profit or loss together with any changes in the
fair value of the hedged asset or liability that is attributed to the hedged risk. For 2023, all interest rate swaps were effective
hedging instruments.
Based on the Euro floating-rate financial assets and floating-rate financial liabilities outstanding at 30 June 2023, if Euro zone
interest rates were to increase/decrease by 200 basis points with all other variables held constant, profit after tax for the year would
have been US$1.9 million lower/higher (2022: US$6.8 million lower from a 200 basis point increase and US$1.7 million higher from
a 50basis point decrease).
In accordance with AASB 9, the carrying value of the loan notes has been adjusted to reduce debt by US$3.6 million
(2022: US$0.3 million) in relation to changes in fair value attributable to the hedged risk. The fair value of interest rate swaps at
reporting date was a liability of US$4.0 million (2022: an asset of US$0.2 million).
Finance revenue/finance costs
Description
Nominal amount (US$m)
Carrying amount (US$m)
Change in fair value (US$m)
Hedge ineffectiveness (US$m)
Balance sheet account impacted
Statement of comprehensive income account impacted
Hedged item Hedging instrumentFair value hedge
€150m of the €500m EMTN
Current borrowings
Foreign exchange hedging is used when a transaction exposure exceeds certain thresholds and as soon as a defined exposure
arises. Within Brambles, exposures may arise with external parties or, alternatively, by way of cross-border intercompany
transactions. Forward foreign exchange contracts are primarily used to manage exposures from normal commercial transactions
such as the purchase and sale of equipment and services, intercompany interest and royalties. Given that Brambles both generates
income and incurs expenses in its local currencies of operation, these exposures are not significant.
Brambles generally mitigates translation exposures by raising debt in currencies where there are matching assets.
Exposure to foreign exchange risk generally arises in either the value of transactions translated back to the functional currency of a
subsidiary or associate, or the value of assets and liabilities of foreign currency subsidiaries or associates when translated back to
the Group’s reporting currency.
116 Consolidated Financial Report Consolidated Financial Report 117
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 23. Financial Risk Management – continued
C) Market Risk – continued
Foreign exchange risk – continued
Currency profile
US Aust. British
dollar dollar Pound Euro Other Total
US$m US$m US$m US$m US$m US$m
2023
Financial assets 360.5 41.5 54.2 161.7 324.7 942.6
Financial liabilities 1,185.2 154.9 81.6 1,788.9 308.9 3,519.5
2022
Financial assets 364.5 35.7 33.7 141.0 295.6 870.5
Financial liabilities 1,168.9 149.3 69.3 1,693.6 352.8 3,433.9
Forward foreign exchange contracts – cash flow hedges
Other forward foreign exchange contracts
Hedge of net investment in foreign entity
Sensitivity analysis
During 2023, Brambles entered into forward foreign exchange transactions with various banks in a variety of cross-currencies for
terms ranging up to seven months.
For 2023 and 2022, all foreign exchange contracts were effective hedging instruments. The fair value of these contracts at reporting
date was nil (2022: nil).
The following table sets out the currency mix profile of Brambles’ financial instruments at reporting date. Financial assets include
cash, trade receivables and derivative assets. Financial liabilities include trade payables, lease liabilities, borrowings and derivative
liabilities:
Brambles enters into other forward foreign exchange contracts for the purpose of hedging various cross-border intercompany
loans to overseas subsidiaries. In this case, the forward foreign exchange contracts provide an economic hedge against exchange
fluctuations on foreign currency loan balances. The face value and terms of the foreign exchange contracts match the
intercompany loan balances. Gains and losses on realignment of the intercompany loans and foreign exchange contracts to spot
rates are offset in the consolidated statement of comprehensive income. Consequently, these foreign exchange contracts are not
designated for hedge accounting purposes and are classified as held for trading. The fair value of these contracts at reporting date
was a net liability of US$2.7 million (2022:net liability of US$5.3 million).
At 30 June 2023, €350.5 million (US$380.9 million) of the 2024 EMTN has been designated as a hedge of the net investment in
Brambles’ European subsidiaries and is being used to partially hedge Brambles’ exposure to foreign exchange risks on these
investments. For 2023 and 2022, there was no ineffectiveness to be recorded from such partial hedges of net investments in
foreign entities.
Based on the financial instruments held at 30 June 2023, if exchange rates were to weaken/strengthen against the US dollar by 10%
with all other variables held constant, the transaction exposure within profit after tax for the year would have been US$0.6million
lower/higher (2022: US$0.6 million lower/higher). The impact on equity would have been US$26.6 million lower/higher (2022:
US$25.8million lower/higher) as a result of the incremental movement through the foreign currency translation reserve relating to
the effective portion of a net investment hedge.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 23. Financial Risk Management – continued
D) Liquidity Risk
Borrowing facilities maturity profile
Year 1 Year 2 Year 3 Year 4 >4 years Total
US$m US$m US$m US$m US$m US$m
2023
Total facilities 967.5 153.4 650.0 - 2,436.7 4,207.6
Facilities used
1
(552.0) (17.2) (500.0) - (1,086.7) (2,155.9)
Facilities available
415.5 136.2 150.0 - 1,350.0 2,051.7
2022
Total facilities 270.3 910.4 575.9 711.6 806.1 3,274.3
Facilities used
1
(44.2) (596.4) (216.1) (607.2) (701.8) (2,165.7)
Facilities available
226.1 314.0 359.8 104.4 104.3 1,108.6
1
Brambles’ objective is to maintain adequate liquidity to meet its financial obligations as and when they fall due. Brambles funds its
operations through existing equity, retained cash flow and borrowings. Funding is generally sourced from relationship banks and
debt capital market investors on a medium to long-term basis.
Bank credit facilities are generally structured on a committed multi-currency revolving basis and at 30 June 2023 had maturities
ranging out to August 2027. Borrowings under the bank credit facilities are floating-rate, unsecured obligations with covenants and
undertakings typical for these types of arrangements.
Borrowings are raised from debt capital markets by the issue of unsecured fixed-interest notes, with interest payable
semi-annually or annually. In December 2022, the Group established a €2.5 billion EMTN shelf programme to facilitate future
issuance in debt capital markets. The programme is listed on the Singapore stock exchange. Alongside this, the Group published a
Green Finance Framework, supported by an independent Environmental, Social and Corporate Governance (ESG) rating report, to
facilitate bond issuance in a 'green' format. In March 2023, Brambles issued a €500.0 million eight-year green bond to cover the
repayment of the €500.0 million EMTN maturing in June 2024 and in support of its circular economy business model.
At 30 June 2023, loan notes had maturities out to March 2031.
At 30 June 2023, the average term to maturity of the committed borrowing facilities and the loan notes is equivalent to 3.7years
(2022: 3.2 years). These facilities are unsecured and are guaranteed as described in Note 32B.
Brambles also has access to further funding through overdrafts, uncommitted and standby lines of credit and the issuance of
commercial paper, which is backed by committed bank facilities. These agreements are principally to manage day-to-day liquidity.
The Euro Commercial Paper (ECP) programme commenced in June 2022 and consists of large volume, high frequency transactions
with a weighted average term to maturity of 1.2 months. ECP cash flows are recorded on a net basis in the consolidated cash flow
statement. At 30 June 2023, there was nil ECP outstanding (2022: nil).
Facilities used represent the principal value of loan notes and borrowings of US$2,155.9 million. This differs by US$1.0 million
(2022: US$4.2million) from loan notes and borrowings as shown in the balance sheet, which are measured on the basis of
amortised cost as determined under the effective interest method and include accrued interest, transaction costs and fair value
adjustments on certain hedging instruments.
In August 2022, Brambles established a new five-year US$1,350.0 million committed syndicated revolving credit facility to refinance
US$992.2 million of existing committed bilateral credit facilities. The syndicated revolving credit facility incorporates sustainability-
linked performance targets consistent with the Group's sustainability targets and roadmap to net-zero greenhouse gas (GHG)
emissions, which remain on track. The pricing of loans under the facility decreases or increases depending on whether the relevant
targets are met. The facility has two one-year extension options subject to banks' consents, the first of which was exercised in
July 2023 to extend the term to August 2028.
118 Consolidated Financial Report Consolidated Financial Report 119
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 23. Financial Risk Management – continued
D) Liquidity Risk – continued
Maturities of financial liabilities
Year 1 Year 2 Year 3 Year 4 >4 years
Total
contractual
cash
flows
Carrying
amount
(assets)/
liabilities
US$m US$m US$m US$m US$m US$m US$m
2023
Non-derivative financial liabilities
Trade payables 626.1 - - - - 626.1 626.1
Bank overdrafts 4.1 - - - - 4.1 4.1
Bank loans 7.1 18.3 - - - 25.4 18.1
Loan notes 608.2 51.9 541.6 31.2 1,187.2 2,420.1 2,132.7
Lease liabilities 139.1 123.5 110.9 102.8 396.7 873.0 729.4
1,384.6 193.7 652.5 134.0 1,583.9 3,948.7 3,510.4
Financial guarantees
2
25.1 - - - - 25.1 -
1,409.7 193.7 652.5 134.0 1,583.9 3,973.8 3,510.4
Derivative financial (assets)/liabilities
Net settled interest rate swaps
- fair value hedges 3.7 - - - - 3.7 4.0
Gross settled forward foreign exchange contracts
- (inflow) (742.9) - - - - (742.9) -
- outflow 745.6 - - - - 745.6 2.7
6.4 - - - - 6.4 6.7
The maturities of Brambles’ contractual cash flows on non-derivative financial liabilities (for principal and interest) and contractual
cash flows on net and gross settled derivative financial instruments, based on the remaining period to contractual maturity date,
are presented below. Cash flows on interest rate swaps and forward foreign exchange contracts are valued based on forward
interest and exchange rates applicable at reporting date.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 23. Financial Risk Management – continued
D) Liquidity Risk – continued
Year 1 Year 2 Year 3 Year 4 >4 years
Total
contractual
cash
flows
Carrying
amount
(assets)/
liabilities
US$m US$m US$m US$m US$m US$m US$m
2022
Non-derivative financial liabilities
Trade payables 549.7 - - - - 549.7 549.7
Bank overdrafts 2.3 - - - - 2.3 2.3
Bank loans 48.8 79.7 212.2 109.1 180.5 630.3 612.0
Loan notes 40.9 563.0 28.5 518.1 537.7 1,688.2 1,547.8
Lease liabilities 164.2 144.7 126.9 112.3 278.1 826.2 713.4
805.9 787.4 367.6 739.5 996.3 3,696.7 3,425.2
Financial guarantees
2
24.0 - - - - 24.0 -
829.9 787.4 367.6 739.5 996.3 3,720.7 3,425.2
Derivative financial (assets)/liabilities
Net settled interest rate swaps
- fair value hedges (1.0) 0.8 - - - (0.2) (0.2)
Gross settled forward foreign exchange contracts
- (inflow) (807.7) - - - - (807.7) -
- outflow 813.0 - - - - 813.0 5.3
4.3 0.8 - - - 5.1 5.1
2
Refer to Note 26a for details on financial guarantees. The amounts disclosed above are the maximum amounts allocated to the
earliest period in which the guarantee could be called. Brambles does not expect these payments to eventuate.
120 Consolidated Financial Report Consolidated Financial Report 121
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 23. Financial Risk Management – continued
E) Credit Risk Exposure
2023 2022
US$m US$m
Total borrowings 2,154.9 2,162.1
Total lease liabilities 729.4 713.4
Less: cash and cash equivalents (160.7) (158.2)
Net debt 2,723.6 2,717.3
Total equity 2,870.0 2,451.1
Total capital 5,593.6 5,168.4
-
-
Loan covenant ratios are calculated including the impact of lease liabilities and on a 12-month rolling basis. EBITDA for the
purpose of loan covenant calculations is Underlying Profit before interest, tax, IPEP, depreciation and amortisation for continuing
and discontinued operations.
Brambles has complied with these financial covenants for 2023 and 2022.
Under the terms of its major borrowing facilities, Brambles is required to comply with the following financial covenants:
the ratio of net debt to EBITDA is to be no more than 3.5 to 1; and
the ratio of EBITDA to net finance costs is to be no less than 3.5 to 1. The ratio of EBITDA to net finance costs is not applicable
to the new five-year US$1,350.0million committed syndicated revolving credit facility.
Brambles transacts derivatives with prominent financial institutions and has credit limits in place to limit exposure to any potential
non-performance by its counterparties.
F) Capital Risk Management
Brambles’ objective when managing capital is to ensure Brambles continues as a going concern, as well as to provide a balance
between financial flexibility and balance sheet efficiency. In determining its capital structure, Brambles considers the robustness of
future cash flows, potential funding requirements for growth opportunities and acquisitions, the cost of capital and ease of access
to funding sources.
Brambles manages its capital structure to be consistent with a solid investment-grade credit rating. At 30 June 2023, Brambles held
investment-grade credit ratings of BBB+ from Standard & Poor’s and Baa1 from Moody’s Investors Service.
Initiatives available to Brambles to achieve its desired capital structure include adjusting the amount of dividends paid to
shareholders, returning capital to shareholders, buying back share capital, issuing new shares, selling assets to reduce debt, varying
the maturity profile of its borrowings and managing discretionary expenses.
Brambles considers its capital to comprise:
Brambles is exposed to credit risk on its financial assets, which comprise cash and cash equivalents, trade and other receivables
and derivative financial instruments. The exposure to credit risks arises from the potential failure of counterparties to meet their
obligations. The maximum exposure to credit risk at the reporting date is the carrying amount of the financial instruments,
including the mark-to-market of hedging instruments where they represent an asset in the balance sheet. Brambles has short-term
deposits available within seven days totalling US$21.4 million which are deposited with banks rated A- by Standard & Poor's.
Following the merger of CHEP China with Loscam China (refer Note 9), Brambles has a non-current shareholder loan receivable
from Loscam China, totalling US$14.0 million (refer Note 10). Other than this, there is no concentration of credit risk.
Brambles trades only with recognised, creditworthy third parties. Collateral is generally not obtained from customers. Customers
are subject to credit verification procedures, including an assessment of their independent credit rating, financial position, past
experience and industry reputation. Credit limits are set for individual customers and approved by credit managers in accordance
with an approved authority matrix. These credit limits are regularly monitored and revised based on historic turnover activity and
credit performance. In addition, overdue receivable balances are monitored and actioned on a regular basis.
Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2023
Note 24. Cash Flow Statement – Additional Information
A) Reconciliation of Cash
2023 2022
Note US$m US$m
For the purpose of the consolidated cash flow statement, cash comprises:
Cash at bank and in hand 139.3 148.1
Short-term deposits
1
21.4 10.1
Cash and cash equivalents 160.7 158.2
Bank overdraft 18 (4.1) (2.3)
156.6 155.9
1
Short-term deposits recognised within cash and cash equivalents have maturities of three months or less and are measured at
amortised cost.
Cash and cash equivalents include deposits with financial institutions and other highly liquid investments which are readily
convertible to cash on hand and are subject to an insignificant risk of changes in value. Bank overdrafts are presented within
borrowings in the balance sheet.
Cash and cash equivalents include balances of US$0.2 million (2022: US$0.2 million) used as security for various contingent
liabilities and are not readily accessible.
Brambles has various master netting and set-off arrangements covering cash pooling. An amount of US$1.7 million has been
reduced from cash at bank and overdraft at 30 June 2023 (2022: US$3.5 million).
122 Consolidated Financial Report Consolidated Financial Report 123
Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2023
Note 24. Cash Flow Statement – Additional Information – continued
B) Reconciliation of Profit After Tax to Net Cash Flow from Operating Activities
2023 2022
US$m US$m
Profit after tax 703.3 593.3
Adjustments for:
- depreciation and amortisation 738.4 691.9
- IPEP expense 285.1 232.0
- gain on divestment of CHEP China (67.3) -
- net gain on disposal of property, plant and equipment (49.6) (15.7)
- impairment of property, plant and equipment 16.6 -
- other valuation adjustments (3.5) (5.2)
- share of results of associates 4.7 4.6
- equity-settled share-based payments 27.5 28.3
- hyperinflation adjustment 18.7 22.0
- net finance revenue and costs 4.2 7.5
Movements in operating assets and liabilities, net of acquisitions and disposals:
- increase in trade and other receivables (124.8) (160.2)
- decrease in prepayments 5.5 25.7
- decrease/(increase) in inventories 3.5 (18.9)
- increase in deferred taxes 57.2 69.3
- increase in trade and other payables 214.0 80.6
- increase in deferred revenue 91.4 40.3
- increase/(decrease) in tax payables 19.9 (19.7)
- increase in provisions 50.1 15.5
- other (3.8) (5.5)
Net cash inflow from operating activities 1,991.1 1,585.8
Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2023
Note 24. Cash Flow Statement – Additional Information – continued
C) Reconciliation of Movement in Net Debt
2023 2022
US$m US$m
Net debt at beginning of the year 2,717.3 2,054.6
Net cash inflow from operating activities (1,991.1) (1,585.8)
Net cash outflow from investing activities 1,493.0 1,499.6
Net payments from disposal of businesses, net of cash disposed 12.4 -
Divestment of CHEP China's gross debt (52.0) -
Payments for share buy-back - 443.9
Dividends paid – ordinary 318.6 304.8
Net (inflow)/outflow from derivative financial instruments (1.1) 49.0
Lease capitalisation, interest accruals and other 135.0 125.7
Foreign exchange differences on borrowings and cash 91.5 (174.5)
Net debt at end of the year 2,723.6 2,717.3
Being:
Current borrowings 562.1 53.7
Current lease liabilities 110.2 140.0
Non-current borrowings 1,592.8 2,108.4
Non-current lease liabilities 619.2 573.4
Cash and cash equivalents (160.7) (158.2)
Net debt at end of the year 2,723.6 2,717.3
D) Non-Cash Financing or Investing Activities
Note 25. Capital Expenditure Commitments
Capital Expenditure Commitments
2023 2022
US$m US$m
Within one year 191.2 380.2
Between one and five years 1.0 1.9
192.2 382.1
There were no financing or investing transactions during the year which had a material effect on the assets and liabilities of
Brambles that did not involve cash flows.
Capital expenditure, principally relating to property, plant and equipment, contracted for but not recognised as liabilities at
reporting date was as follows:
124 Consolidated Financial Report Consolidated Financial Report 125
Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2023
Note 26. Contingencies
a)
b)
c)
As a consequence of the nature of these activities, Brambles has incurred and may continue to incur environmental costs and
liabilities associated with site and facility operation, closure, remediation, aftercare, monitoring and licensing. Provisions have
been made in respect of estimated environmental liabilities at all sites and facilities where probable outflow of resources have
been identified.
However, additional liabilities may emerge due to a number of factors including changes in the numerous laws and regulations
which govern environmental protection, liability, land use, planning, climate change and other matters in each jurisdiction in
which Brambles operates or has operated. These extensive laws and regulations are continually evolving in response to
technological advances, scientific developments, climate change and other factors. Brambles cannot predict the extent to which
it may be affected in the future by any such changes in legislation or regulation.
In the ordinary course of business, Brambles becomes involved in litigation, tax and indirect tax audits and other commercial
disputes. Provisions have been made for known obligations where the existence of the liability is probable and can be
reasonably quantified. Receivables have been recognised where recoveries, for example from insurance arrangements, are
virtually certain.
As the outcomes of these matters remain uncertain, contingent liabilities exist for any potential amounts payable.
Brambles defended a consolidated class action raised on behalf of certain shareholders who acquired shares during the period
between 18 August 2016 and 20 February 2017. The trial took place from 8 August 2022 to 8 September 2022 and on
26 and 27 October 2022, and a decision from the trial judge is pending.
Subsidiaries have contingent unsecured liabilities in respect of guarantees given relating to leases, workers compensation
insurance and other obligations totalling US$25.1 million (2022: US$24.0 million), of which US$23.5million
(2022:US$15.1million) is guaranteed by Brambles Limited.
Environmental contingent liabilities
Brambles’ activities have previously included the treatment and disposal of hazardous and non-hazardous waste through
subsidiaries and corporate joint ventures or associates. In addition, other activities of Brambles entail using, handling and
storing materials which are capable of causing environmental impairment.
Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2023
Note 27. Auditor’s Remuneration
2023 2022
US$’000 US$’000
Audit and review services:
- PwC Australia 2,368 2,203
- Other PwC network firms 3,083 2,659
Total audit and review services 5,451 4,862
Other assurance services (which could be performed by other firms):
- PwC Australia 135 -
- Other PwC network firms 6 32
Total other assurance services 141 32
Total remuneration for audit, review and other assurance services 5,592 4,894
Other services:
- Other – PwC Australia 13 12
- Other – other PwC network firms 1 1
Total other services
1
14 13
Total auditor’s remuneration 5,606 4,907
1
From time to time, Brambles employs PwC on assignments additional to its statutory audit duties where PwC, through its detailed
knowledge of the Group, is best placed to perform the services from an efficiency, effectiveness and cost perspective. The
performance of such non-audit related services is always balanced with the fundamental objective of ensuring PwC’s objectivity
and independence as auditors. To ensure this balance, Brambles’ Charter of Audit Independence outlines the services that can be
undertaken by the auditors and requires that the Audit& Risk Committee approves any management recommendation that PwC
undertakes non-audit work (with approval being delegated to the Chief Financial Officer within specified monetary limits and
reported to the Audit & Risk Committee).
Other services in 2023 and 2022 primarily related to corporate administration.
126 Consolidated Financial Report Consolidated Financial Report 127
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 28. Key Management Personnel
A) Key Management Personnel Compensation
2023 2022
US$’000 US$’000
Short-term employee benefits 8,131 7,575
Post-employment benefits 191 189
Other benefits 69 44
Share-based payment expense 5,269 5,045
13,660 12,853
B) Other Transactions with Key Management Personnel
Note 29. Related Party Information
A) Other Transactions
B) Other Related Parties
Other transactions entered into during the year with Directors of Brambles Limited, with Director-related entities, with
KeyManagement Personnel (KMP, as set out in the Remuneration Report), or with KMP-related entities, were on terms and
conditions no more favourable than those available to other employees, customers or suppliers and include transactions in respect
of the employee option plans, contracts of employment, service agreements with Non-Executive Directors and reimbursement of
expenses. Any other transactions were trivial in nature.
A subsidiary has a non-interest bearing advance outstanding as at 30 June 2023 of US$944,193 (2022: US$1,054,928) to
BramblesCustodians Pty Limited, the trustee under Brambles' employee loan scheme. This scheme enabled employees to acquire
shares in Brambles Industries Limited (BIL) and has been closed to new entrants since August 2002.
Other transactions with Key Management Personnel are set out in Note 29A.
Further remuneration disclosures are set out in the Directors’ Report on pages 47 to 66 of the Annual Report.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 29. Related Party Information – continued
C) Material Subsidiaries
The principal subsidiaries of Brambles during the year were:
2023 2022
CHEP USA USA 100 100
CHEP Canada Corp Canada 100 100
CHEP UK Limited UK 100 100
CHEP Equipment Pooling NV Belgium 100 100
CHEP South Africa (Proprietary) Limited South Africa 100 100
CHEP Australia Limited Australia 100 100
CHEP Mexico SRL Mexico 100 100
Brambles USA Inc. USA 100 100
Brambles Finance plc UK 100 100
Brambles Finance Limited Australia 100 100
Note 30. Events After Balance Sheet Date
Other than those outlined in the Directors' Report or elsewhere in these financial statements, no other events have occurred
subsequent to 30 June 2023 and up to the date of this report that have had a material impact on Brambles' financial performance
or position.
Name Place of incorporation
In addition to the list above, there are a number of other non-material subsidiaries within Brambles.
Investments in subsidiaries are primarily by means of ordinary or common shares. Shares in subsidiaries are recorded at cost, less
provision for impairment.
% interest held at
reporting date
Material subsidiaries which prepare statutory financial statements report a 30 June balance sheet date, with the exception of
CHEP Mexico SRL, which reports a 31 December balance sheet date.
128 Consolidated Financial Report Consolidated Financial Report 129
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 31. Net Assets Per Share
2023 2022
US cents US cents
Based on 1,389.3 million shares (2022: 1,386.2 million shares):
- Net tangible assets per share 189.2 159.3
- Net assets per share 206.6 176.8
Note 32. Parent Entity Financial Information
A) Summarised Financial Data of Brambles Limited
Parent entity
2023 2022
US$m US$m
Profit/(loss) for the year
1
1,654.2 (7.2)
Other comprehensive loss for the year
2
(146.2) (381.6)
Total comprehensive income/(loss) 1,508.0 (388.8)
Current assets 0.2 0.1
Non-current assets 5,188.8 4,531.7
Total assets 5,189.0 4,531.8
Current liabilities 37.3 34.5
Non-current liabilities 20.2 570.9
Total liabilities 57.5 605.4
Net assets 5,131.5 3,926.4
Contributed equity 4,531.6 4,505.8
Share-based payment reserve 71.6 68.3
Foreign currency translation reserve (981.6) (835.4)
Retained earnings 1,509.9 187.7
Total equity 5,131.5 3,926.4
1
Profit for the year in 2023 includes dividend income received from subsidiaries.
2
Comprises foreign currency translation movements.
Net tangible assets per share is calculated by dividing total equity attributable to the members of the parent entity, less goodwill
and intangible assets, by the number of shares on issue at year end.
Net assets per share is calculated by dividing total equity attributable to the members of the parent entity by the number of shares
on issue at year end.
Notes to and Forming Part of the Financial Statements
– continued
for the year ended 30 June 2023
Note 32. Parent Entity Financial Information – continued
A) Summarised Financial Data of Brambles Limited – continued
B) Guarantees and Contingent Liabilities
C) Contractual Commitments
Brambles Limited did not have any contractual commitments for the acquisition of property, plant and equipment at
30 June 2023 or 30June 2022.
Brambles Limited and certain of its subsidiaries are parties to a deed of cross-guarantee which supports global financing credit
facilities available to certain subsidiaries. At 30 June 2023, total facilities available amount to US$1,781.6 million
(2022:US$1,421.3million), of which nil (2022: US$538.6million) has been drawn.
Brambles Limited and certain of its subsidiaries are parties to a guarantee which supports loan notes of US$500.0million (2022:
US$500.0million) issued by a subsidiary to qualified institutional buyers in accordance with Rule 144A and Regulation S of the
United States Securities Act .
The financial information for the parent entity has been prepared on the same basis as the consolidated financial statements
except for investments and receivables from subsidiaries. In the parent entity financial information, investments in subsidiaries are
accounted for at cost and receivables from subsidiaries are held at amortised cost. Where appropriate, receivables from
subsidiaries have been adjusted for expected credit losses. Dividends received from investments in subsidiaries are recognised as
revenue.
Brambles Limited was served with class action proceedings in 2018 which has been disclosed as a contingent liability
(referNote26c).
Brambles Limited has guaranteed repayment of certain facilities and financial accommodations made available to certain
subsidiaries. At 30 June 2023, total facilities and financial accommodations available to subsidiaries amount to US$427.0 million
(2022: US$477.0million), of which US$45.1 million (2022: US$95.6million) has been drawn.
Brambles Limited and certain of its subsidiaries are parties to a guarantee which supports a programme of Euro commercial paper
available to certain subsidiaries. At 30 June 2023, total programme availability amounts to €750.0 million (2022: €750.0 million), of
which nil (2022: nil) has been drawn.
Brambles Limited and certain of its subsidiaries are parties to a guarantee which supports a €2.5 billion Euro Medium Term Note
(EMTN) programme, of which €500.0 million relating to a green bond financing instrument, was drawn in March 2023.
As part of its normal funding arrangements, Brambles Limited has guaranteed US$48.0 million of bank borrowings of CHEP China.
In accordance with the Business Combination Agreement between Brambles and Loscam China, the parties have refinanced the
borrowings of CHEP China and released the Brambles guarantee in August 2023.
Brambles Limited and certain of its subsidiaries are parties to a guarantee which supports loan notes of €1,000.0 million (2022:
€1,000.0million) issued by two subsidiaries in the European bond market.
130 Consolidated Financial Report Consolidated Financial Report 131
Directors’ Declaration
In the opinion of the Directors of Brambles Limited:
(a)
(i)
(ii)
(b)
J P Mullen
Chair
G A Chipchase
Chief Executive Officer
30 August 2023
This declaration is made in accordance with a resolution of the Directors.
The Directors have been given the declarations by the Chief Executive Officer and Chief Financial Officer required by section 295A
of the Corporations Act 2001.
the financial statements and notes set out on pages 74 to 131 are in accordance with the Corporations Act 2001, including:
complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting
requirements; and
giving a true and fair view of the consolidated financial position of Brambles Limited as at 30June2023 and of its
performance for the year ended on that date.
there are reasonable grounds to believe that Brambles Limited will be able to pay its debts as and when they become due
and payable.
A statement of compliance with International Financial Reporting Standards as issued by the International Accounting Standards
Board is included within Note1 to the financial statements.
P
ricewaterhouseCoopers, ABN 52 780 433 75
7
One International Towers Sydney, Watermans Quay, Barangaroo, GPO BOX 2650, SYDNEY NSW 2001
T: +61 2 8266 0000, F: +61 2 8266 9999, www.pwc.com.au
Level 11, 1PSQ, 169 Macquarie Street, Parramatta NSW 2150, PO Box 1155 Parramatta NSW 2124
T: +61 2 9659 2476, F: +61 2 8266 9999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.
Independent auditor’s report
To the members of Brambles Limited
Report on the audit of the financial report
Our opinion
In our opinion:
The accompanying financial report of Brambles Limited (the Company) and its controlled entities
(together the Group) is in accordance with the Corporations Act 2001, including:
(a) giving a true and fair view of the Group's financial position as at 30 June 2023 and of its
financial performance for the year then ended
(b) complying with Australian Accounting Standards and the Corporations Regulations 2001.
What we have audited
The Group financial report comprises:
● the consolidated balance sheet as at 30 June 2023
● the consolidated statement of comprehensive income for the year then ended
● the consolidated statement of changes in equity for the year then ended
● the consolidated cash flow statement for the year then ended
● the notes to and forming part of the financial statements, which include significant accounting
policies and other explanatory information
● the directors’ declaration.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial
report section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Independence
We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also
fulfilled our other ethical responsibilities in accordance with the Code.
Independent Auditor’s Report
to the Members of Brambles Limited
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of
this auditor’s report, we conclude that there is a material misstatement of this other information, we
are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of the financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of
our auditor's report.
Report on the remuneration report
Our opinion on the remuneration report
We have audited the remuneration report included in pages 47 to 66 of the directors’ report for the
year ended 30 June 2023.
In our opinion, the remuneration report of Brambles Limited for the year ended 30 June 2023
complies with section 300A of the Corporations Act 2001.
Independent Auditor’s Report 133Directors’ Declaration132
Our audit approach
An audit is designed to provide reasonable assurance about whether the financial report is free from
material misstatement. Misstatements may arise due to fraud or error. They are considered material if
individually or in aggregate, they could reasonably be expected to influence the economic decisions of
users taken on the basis of the financial report.
We tailored the scope of our audit to ensure that we performed enough work to be able to give an
opinion on the financial report as a whole, taking into account the geographic and management
structure of the Group, its accounting processes and controls and the industry in which it operates.
Materiality
● For the purpose of our audit, we used overall Group materiality of $46 million, which represents
approximately 5% of the Group’s profit before tax from continuing operations.
● We applied this threshold, together with qualitative considerations, to determine the scope of our audit and
the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements on the
financial report as a whole.
● We chose Group profit before tax because, in our view, it is the benchmark against which the performance of
the Group is most commonly measured and it is a generally accepted benchmark.
●
We utilised a 5% threshold based on our professional judgement, noting it is within the range of commonly
acceptable thresholds.
Audit Scope
● Our audit focused on where the Group made subjective judgements; for example, significant accounting
estimates involving assumptions and inherently uncertain future events.
● The Group’s financial results comprise the consolidation of a network of pooled pallet, crate and container
businesses which are geographically widespread. We tailored the scope of our audit so that we performed
sufficient work to be able to provide an opinion on the financial report as a whole, taking into account the
structure of the Group, the significance and risk profile of each business, the accounting processes and
controls, and the industry in which the Group operates.
Audit of locations, transactions and balances
● Separate PwC firms in the relevant locations (“local PwC audit firms”) performed an audit of the financial
information prepared for consolidation purposes for ten components of the Group. The components were
selected due to their significance to the Group, either by individual size or by risk. Certain components in
the Group are selected every year due to their size or nature, whilst others are included on a rotational basis.
Independent Auditor’s Report - continued
to the Members of Brambles Limited
Key audit matter
H
ow our audit addressed the key audit matte
r
Accounting for pooling equipment assets
(Refer to Note 13)
Brambles’ pooling equipment is accounted for as
depreciable fixed assets, classified within property,
plant and equipment. The accounting for pooling
equipment
was a key audit matter due to the assets’
financial size and judgement involved.
As disclosed in Note 13 of the financial report, there
is inherent risk in accounting for pooling equipment
due to the high volume of asset movements through
a complex network, and a limitation on the Group’s
ability to physically verify the quantity of the pallets,
crates and containers due to access and cost
prohibitions. The largest category of pooling
equipment is pallets.
The key area of judgement in relation to pooled
pallets is the quantity of lost pallets. The
irrecoverable pooling equipment provision (IPEP) is
calculated by considering the current and historical
experience of pallet loss and pallet flows analysis, as
reported through the asset management system.
The determination of pallet losses is a significant
estimate due to the subjectivity involved in the
estimated pallet loss rates.
We performed the following procedures over pooling
equipment assets, amongst others:
● Evaluated the design and operating effectiveness
of key controls. Tested a selection of asset
management controls including attending pallet
audits and assessing the results of the Group’s
counts.
● Reperformed key reconciliations for pallet
balances between the accounting records and the
asset management system.
● In auditing the IPEP provision calculation
methodology we:
o assessed appropriateness of significant
assumptions and judgements for
distributors who are not customers of
CHEP, as losses from such distributors
are historically higher than those of direct
customers;
o assessed provision estimates for
significant customers where CHEP has no
access to physically count the pallets;
o evaluated how historic pallet loss rates
and flows are used to estimate current
losses; and
o for a selection of locations, reviewed the
calculations and extrapolations of
provision estimates across pallet
locations.
● Evaluated the reasonableness of disclosures made
in Note 13, including those related to estimation
uncertainty, against the requirements of
Australian Accounting Standards.
Other information
The directors are responsible for the other information. The other information comprises the
information included in the annual report for the year ended 30 June 2023, but does not include the
financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon.
Independent Auditor’s Report - continued
to the Members of Brambles Limited
● In addition, local PwC audit firms performed risk focused targeted audit or specified procedures on selected
transactions and balances for a further nine components.
● The remaining components were financially insignificant. These components are considered as part of
Group analytical procedures and other specified procedures.
Audit of shared services functions
● Our procedures on IT, tax and certain finance processes were performed by local PwC audit firms based in
various territories, reflecting the location of the Group’s shared services functions. This included some audit
procedures performed at the Group’s finance process outsourced services provider. The PwC Australia
Group audit team (the Group audit team) performed audit procedures over centrally managed areas such as
the impairment assessment of goodwill, share based payments, retirement benefit obligations, treasury and
the consolidation process.
Direction and supervision by the Group Audit team
● The audit procedures were performed by PwC Australia and local PwC audit firms operating under the
Group audit team’s instructions. The Group audit team determined the level of involvement needed in the
audit work of local PwC audit firms to be satisfied that sufficient audit evidence had been obtained for the
purpose of the opinion. The Group audit team kept in regular communication with the local PwC audit firms
throughout the year through phone calls, discussions and written instructions. Senior members of the
Group audit team visited certain businesses throughout the year and met with management and local PwC
audit teams including the two largest locations. The audit team both at Group and at local component levels
were appropriately skilled and competent to perform an audit of a complex global business. This included
specialists and experts in areas such as IT, actuarial, tax and valuations.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of
the financial report for the current period. The key audit matters were addressed in the context of our audit of the
financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters. Further, any commentary on the outcomes of a particular audit procedure is made in that context.
We communicated the key audit matters to the Audit and Risk Committee.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of
this auditor’s report, we conclude that there is a material misstatement of this other information, we
are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of the financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of
our auditor's report.
Report on the remuneration report
Our opinion on the remuneration report
We have audited the remuneration report included in pages 47 to 66 of the directors’ report for the
year ended 30 June 2023.
In our opinion, the remuneration report of Brambles Limited for the year ended 30 June 2023
complies with section 300A of the Corporations Act 2001.
Independent Auditor’s ReportIndependent Auditor’s Report134 135
Key audit matter
H
ow our audit addressed the key audit matte
r
Accounting for pooling equipment assets
(Refer to Note 13)
Brambles’ pooling equipment is accounted for as
depreciable fixed assets, classified within property,
plant and equipment. The accounting for pooling
equipment
was a key audit matter due to the assets’
financial size and judgement involved.
As disclosed in Note 13 of the financial report, there
is inherent risk in accounting for pooling equipment
due to the high volume of asset movements through
a complex network, and a limitation on the Group’s
ability to physically verify the quantity of the pallets,
crates and containers due to access and cost
prohibitions. The largest category of pooling
equipment is pallets.
The key area of judgement in relation to pooled
pallets is the quantity of lost pallets. The
irrecoverable pooling equipment provision (IPEP) is
calculated by considering the current and historical
experience of pallet loss and pallet flows analysis, as
reported through the asset management system.
The determination of pallet losses is a significant
estimate due to the subjectivity involved in the
estimated pallet loss rates.
We performed the following procedures over pooling
equipment assets, amongst others:
● Evaluated the design and operating effectiveness
of key controls. Tested a selection of asset
management controls including attending pallet
audits and assessing the results of the Group’s
counts.
● Reperformed key reconciliations for pallet
balances between the accounting records and the
asset management system.
● In auditing the IPEP provision calculation
methodology we:
o assessed appropriateness of significant
assumptions and judgements for
distributors who are not customers of
CHEP, as losses from such distributors
are historically higher than those of direct
customers;
o assessed provision estimates for
significant customers where CHEP has no
access to physically count the pallets;
o evaluated how historic pallet loss rates
and flows are used to estimate current
losses; and
o for a selection of locations, reviewed the
calculations and extrapolations of
provision estimates across pallet
locations.
● Evaluated the reasonableness of disclosures made
in Note 13, including those related to estimation
uncertainty, against the requirements of
Australian Accounting Standards.
Other information
The directors are responsible for the other information. The other information comprises the
information included in the annual report for the year ended 30 June 2023, but does not include the
financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon.
Independent Auditor’s Report - continued
to the Members of Brambles Limited
Key audit matter
H
ow our audit addressed the key audit matte
r
Accounting for pooling equipment assets
(Refer to Note 13)
Brambles’ pooling equipment is accounted for as
depreciable fixed assets, classified within property,
plant and equipment. The accounting for pooling
equipment
was a key audit matter due to the assets’
financial size and judgement involved.
As disclosed in Note 13 of the financial report, there
is inherent risk in accounting for pooling equipment
due to the high volume of asset movements through
a complex network, and a limitation on the Group’s
ability to physically verify the quantity of the pallets,
crates and containers due to access and cost
prohibitions. The largest category of pooling
equipment is pallets.
The key area of judgement in relation to pooled
pallets is the quantity of lost pallets. The
irrecoverable pooling equipment provision (IPEP) is
calculated by considering the current and historical
experience of pallet loss and pallet flows analysis, as
reported through the asset management system.
The determination of pallet losses is a significant
estimate due to the subjectivity involved in the
estimated pallet loss rates.
We performed the following procedures over pooling
equipment assets, amongst others:
● Evaluated the design and operating effectiveness
of key controls. Tested a selection of asset
management controls including attending pallet
audits and assessing the results of the Group’s
counts.
● Reperformed key reconciliations for pallet
balances between the accounting records and the
asset management system.
● In auditing the IPEP provision calculation
methodology we:
o assessed appropriateness of significant
assumptions and judgements for
distributors who are not customers of
CHEP, as losses from such distributors
are historically higher than those of direct
customers;
o assessed provision estimates for
significant customers where CHEP has no
access to physically count the pallets;
o evaluated how historic pallet loss rates
and flows are used to estimate current
losses; and
o for a selection of locations, reviewed the
calculations and extrapolations of
provision estimates across pallet
locations.
● Evaluated the reasonableness of disclosures made
in Note 13, including those related to estimation
uncertainty, against the requirements of
Australian Accounting Standards.
Other information
The directors are responsible for the other information. The other information comprises the
information included in the annual report for the year ended 30 June 2023, but does not include the
financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of
this auditor’s report, we conclude that there is a material misstatement of this other information, we
are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of the financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of
our auditor's report.
Report on the remuneration report
Our opinion on the remuneration report
We have audited the remuneration report included in pages 47 to 66 of the directors’ report for the
year ended 30 June 2023.
In our opinion, the remuneration report of Brambles Limited for the year ended 30 June 2023
complies with section 300A of the Corporations Act 2001.
Independent Auditor’s Report - continued
to the Members of Brambles Limited
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of
this auditor’s report, we conclude that there is a material misstatement of this other information, we
are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of the financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of
our auditor's report.
Report on the remuneration report
Our opinion on the remuneration report
We have audited the remuneration report included in pages 47 to 66 of the directors’ report for the
year ended 30 June 2023.
In our opinion, the remuneration report of Brambles Limited for the year ended 30 June 2023
complies with section 300A of the Corporations Act 2001.
Independent Auditor’s ReportIndependent Auditor’s Report136 137
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
remuneration report in accordance with section 300A of the Corporations Act 2001. Our
responsibility is to express an opinion on the remuneration report, based on our audit conducted in
accordance with Australian Auditing Standards.
PricewaterhouseCoopers
Debbie Smith Sydney
Partner 30 August 2023
Eliza Penny Sydney
Partner 30 August 2023
Independent Auditor’s Report - continued
to the Members of Brambles Limited
Key audit matter
H
ow our audit addressed the key audit matte
r
Accounting for pooling equipment assets
(Refer to Note 13)
Brambles’ pooling equipment is accounted for as
depreciable fixed assets, classified within property,
plant and equipment. The accounting for pooling
equipment
was a key audit matter due to the assets’
financial size and judgement involved.
As disclosed in Note 13 of the financial report, there
is inherent risk in accounting for pooling equipment
due to the high volume of asset movements through
a complex network, and a limitation on the Group’s
ability to physically verify the quantity of the pallets,
crates and containers due to access and cost
prohibitions. The largest category of pooling
equipment is pallets.
The key area of judgement in relation to pooled
pallets is the quantity of lost pallets. The
irrecoverable pooling equipment provision (IPEP) is
calculated by considering the current and historical
experience of pallet loss and pallet flows analysis, as
reported through the asset management system.
The determination of pallet losses is a significant
estimate due to the subjectivity involved in the
estimated pallet loss rates.
We performed the following procedures over pooling
equipment assets, amongst others:
● Evaluated the design and operating effectiveness
of key controls. Tested a selection of asset
management controls including attending pallet
audits and assessing the results of the Group’s
counts.
● Reperformed key reconciliations for pallet
balances between the accounting records and the
asset management system.
● In auditing the IPEP provision calculation
methodology we:
o assessed appropriateness of significant
assumptions and judgements for
distributors who are not customers of
CHEP, as losses from such distributors
are historically higher than those of direct
customers;
o assessed provision estimates for
significant customers where CHEP has no
access to physically count the pallets;
o evaluated how historic pallet loss rates
and flows are used to estimate current
losses; and
o for a selection of locations, reviewed the
calculations and extrapolations of
provision estimates across pallet
locations.
● Evaluated the reasonableness of disclosures made
in Note 13, including those related to estimation
uncertainty, against the requirements of
Australian Accounting Standards.
Other information
The directors are responsible for the other information. The other information comprises the
information included in the annual report for the year ended 30 June 2023, but does not include the
financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon.
PricewaterhouseCoopers, ABN 52 780 433 757
One International Towers Sydney, Watermans Quay, Barangaroo, GPO BOX 2650, SYDNEY NSW 2001
T: +61 2 8266 0000, F: +61 2 8266 9999, www.pwc.com.au
Level 11, 1PSQ, 169 Macquarie Street, Parramatta NSW 2150, PO Box 1155 Parramatta NSW 2124
T: +61 2 9659 2476, F: +61 2 8266 9999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.
Auditor’s Independence Declaration
As lead auditor for the audit of Brambles Limited for the year ended 30 June 2023, I declare that
to the best of my knowledge and belief, there have been:
(a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
(b) no contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Brambles Limited and the entities it controlled during the period.
Debbie Smith Sydney
Partner 30 August 2023
PricewaterhouseCoopers
Auditor’s Independence Declaration
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of
this auditor’s report, we conclude that there is a material misstatement of this other information, we
are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of the financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of
our auditor's report.
Report on the remuneration report
Our opinion on the remuneration report
We have audited the remuneration report included in pages 47 to 66 of the directors’ report for the
year ended 30 June 2023.
In our opinion, the remuneration report of Brambles Limited for the year ended 30 June 2023
complies with section 300A of the Corporations Act 2001.
Auditor’s Independence Declaration 139Independent Auditor’s Report138
Five-Year Financial Performance Summary
1
The CHEP China business is presented within discontinued operations in 2023 and 2022. Periods prior to 2022 included the CHEP China business within continuing
operations and are consistent with previously published data. The Kegstar business is presented within discontinued operations in 2021 and 2020. Periods prior to
2020 include Kegstar within continuing operations and are consistent with previously published data.
2
2021 has been restated for the change in accounting policy relating to Software as a Service arrangements. Periods prior to 2021 have not been restated for the
impact of this change in accounting policy. Periods prior to 2020 have not been restated for the impact of new accounting standard AASB 16 Leases.
3
Effective from 2020, EBITDA has been redefined as Underlying Profit from continuing operations after adding back depreciation, amortisation and IPEP expense.
Prior periods have been restated to align with the revised definition. The key financing ratios for periods prior to 2020 have not been restated to align with the
revised EBITDA definition and are consistent with previously published data.
4
Brambles applied AASB 129 Financial Reporting in Hyperinflationary Economies from 2022.
5
Effective from 2020, Brambles changed to a payout ratio-based dividend policy, with the dividend per share declared in US cents and converted and paid in
Australian cents. Prior to 2020, dividends were declared and paid in Australian cents.
US$m 2023 2022 2021 2020 2019
Continuing operations
1
Sales revenue 6,076.8 5,519.8 5,209.8 4,717.9 4,595.3
EBITDA
2
,
3
2,082.2 1,841.5 1,737.2 1,561.8 1,415.1
Depreciation and amortisation
2
(730.1) (679.5) (664.3) (607.7) (484.3)
IPEP expense (285.1) (232.0) (198.3) (154.7) (127.1)
Underlying Profit 1,067.0 930.0 874.6 799.4 803.7
Significant Items -
- - - (62.8)
Operating profit 1,067.0 930.0 874.6 799.4 740.9
Net finance costs (114.1) (86.3) (85.6) (80.8) (88.5)
Net impact arising from hyperinflationary economies
4
(18.7)
(22.0) - - -
Profit before tax 934.2 821.7 789.0 718.6 652.4
Tax expense (287.1) (247.9) (257.5) (210.6) (198.3)
Profit from continuing operations 647.1 573.8 531.5 508.0 454.1
Profit/(loss) from discontinued operations
1
56.2 19.5 (8.9) (60.0) 1,013.6
Profit for the year 703.3 593.3 522.6 448.0 1,467.7
Weighted average number of shares (millions) 1,388.0 1,415.7 1,475.1 1,548.7 1,593.4
Earnings per share (US cents)
Basic 50.7 41.9 35.4 28.9 92.1
From continuing operations 46.6 40.5 36.0 32.8 28.5
On Underlying Profit after finance costs and tax 48.0 42.1 37.6 32.8 31.9
ROCI
2
,
4
19% 18% 18% 17% 19%
Capex on property, plant and equipment
1
1,567.1 1,787.0 1,219.0 968.4 1,060.4
Balance sheet
Capital employed 5,593.6 5,168.4 4,735.9 4,468.2 3,905.9
Net debt
2
2,723.6 2,717.3 2,054.6 1,711.8 97.7
Equity 2,870.0 2,451.1 2,681.3 2,756.4 3,808.2
Average Capital Invested
1,2
5,763.6 5,150.5 4,930.5 4,698.7 4,130.6
Cash flow
Cash Flow from Operations - continuing
2
789.8 391.8 901.1 754.8 431.8
Free Cash Flow
2
498.1 86.2 622.0 462.2 238.5
Ordinary dividends paid, net of Dividend Reinvestment Plan (318.6) (304.8) (280.8) (290.7) (328.1)
Free Cash Flow after ordinary dividends 179.5 (218.6) 341.2 171.5 (89.6)
Key financing ratios
2,3
Net debt to EBITDA (times) 1.3 1.5 1.2 1.1 0.1
EBITDA interest cover (times)
18.2 21.3 20.4 19.3 14.6
Average employees 12,262 11,894 11,569 11,647 10,896
Dividend declared
5
(cents per share) 26.25 US 22.75 US 20.5 US 18.0 US 29.0 AU
Glossary
Acquired Shares Brambles Limited shares purchased by Brambles' employees under MyShare
Actual currency/actual FX
Results translated into US dollars at the applicable actual monthly exchange rates
ruling in each period. Results for hyperinflationary economies are translated to
US dollars at the period end spot FX rates
AGM Annual General Meeting
ACI
(Average Capital Invested)
A 12-month average of capital invested; capital invested is calculated as net assets
before tax balances, cash, borrowings and lease liabilities, but after adjustment for
pension plan actuarial gains or losses and net equity adjustments for equity-settled
share-based payments
AU cents Australian cents
BIFR
(Brambles Injury Frequency Rate)
Safety performance indicator that measures the combined number of fatalities, lost-
time injuries, modified duties and medical treatments per million hours worked
BIL Brambles Industries Limited, which was one of the two listed entities in the previous
dual-listed companies structure
Biogenic carbon Carbon that is sequestered from the atmosphere during biomass growth and may be
released back to the atmosphere later due to combustion of the biomass or
decomposition
BIP
Brambles Industries plc, which was one of the two listed entities in the previous dual-
listed companies structure
Board The Board of Directors of Brambles Limited, details of which are on pages 40 to 43
CAGR
(Compound Annual Growth Rate)
The annualised percentage at which a measure (e.g. sales revenue) would have grown
over a period if it grew at a steady rate
Cash Flow from Operations
A non-statutory measure of cash flow generated from operations after net capital
expenditure but excluding Significant Items that are outside the ordinary course of
business and discontinued operations
Circular economy
A circular economy regenerates and circulates key resources, ensuring products,
components and materials are at their highest utility and value at all times
CGPR
The Australian Securities Exchange Corporate Governance Council Corporate
Governance Principles & Recommendations, Fourth Edition
Company Brambles Limited (ACN 118 896 021)
Constant currency/constant FX Current period results (excluding hyperinflationary economies) translated into
US dollars at the actual monthly exchange rates applicable in the comparable period,
so as to show relative performance between the two periods. Results for
hyperinflationary economies are not retranslated and remain at their reported actual
exchange rates (period-end spot exchange rates).
Continuing operations Continuing operations refers to CHEP Americas, CHEP EMEA and CHEP Asia-Pacific
(each primarily comprising pallet and container pooling businesses in those regions
operating under the CHEP brand), and Corporate (corporate centre including
Shaping Our Future)
CRM
(Client Relationship Management)
Software tool for managing relationships and interactions with customers and
potential customers
Discontinued operations Operations which have been divested/demerged, or which are held for sale
DRP
(Dividend Reinvestment Plan)
The Brambles Dividend Reinvestment Plan, under which Australian and New Zealand
shareholders can elect to apply some or all of their dividends to the purchase of
shares in Brambles Limited instead of receiving cash
Economic value A measure of the broader financial benefit provided by an organisation
EPS
(Earnings Per Share)
Profit after finance costs, tax, minority interests and Significant Items, divided by the
weighted average number of shares on issue during the period
Glossary 141Five-Year Financial Performance Summary140
Glossary continued
EBITDA
(Earnings before Interest, Tax,
Depreciation and Amortisation)
Underlying Profit from continuing operations after adding back depreciation,
amortisation and IPEP expense
ELT Brambles’ Executive Leadership Team, details of which are on pages 44 to 46
Emission scope
Scope 1: carbon emissions from fuel combustion at Brambles’ operations and under
Brambles' direct control
Scope 2: carbon emissions resulting from grid electricity used in Brambles' operations.
While considered ‘indirect’, Brambles' level of control is considered high
Scope 3: carbon emissions resulting from goods and services purchased. Also
considered ‘supply chain’ emissions
Source: https://ghgprotocol.org/
Free Cash Flow
Cash flow generated after net capital expenditure, finance costs and tax, but excluding
the net cost of acquisitions and proceeds from business disposals
FY
(Financial Year)
Brambles’ financial year is 1 July to 30 June; FY23 indicates the financial year ended
30 June 2023
Group or Brambles Brambles Limited and all of its related bodies corporate
Group Profit Leverage Reflects the amount by which Underlying Profit growth exceeds sales revenue growth
IBCs
(Intermediate Bulk Containers)
Palletised containers used for the transport and storage of bulk products in a variety
of industries, including the food, chemical, pharmaceutical and transportation
industries
IPEP
(Irrecoverable Pooling Equipment
Provision)
Provision held by Brambles to account for pooling equipment that cannot be
economically recovered and for which there is no reasonable expectation of receiving
compensation
Key Management Personnel Members of the Board of Brambles Limited and Brambles’ Executive Leadership Team
KPI(s) Key Performance Indicator(s)
LTI Long-Term Incentive
Matching Awards Matching share rights over Brambles Limited shares allocated to employees when
they purchase Acquired Shares under MyShare; when an employee’s Matching
Awards vest, Matching Shares are allocated
Matching Shares Shares allocated to employees who have held Acquired Shares under MyShare for
two years, and who remain employed at the end of that two-year period; one
Matching Share is allocated for every Acquired Share held
MyShare
The Brambles Limited MyShare plan, an all-employee share plan, under which
employees acquire ordinary shares by means of deductions from their after-tax pay
and must hold those shares for a two-year period. If an employee holds those
shares and remains employed at the end of the two-year period, Brambles will match
the number of shares that employee holds by issuing or transferring to them the
same number of shares they held for the qualifying period, at no additional cost to
the employee
NPS
(Net Promoter Score)
Measure used to gauge customer experience and satisfaction
Operating profit Statutory definition of profit before finance costs and tax; sometimes called EBIT
(earnings before interest and tax)
Performance Period
A two-to-three-year period over which the achievement of performance conditions is
assessed to determine whether STI and LTI share awards will vest
Performance Share Plan or PSP The Brambles Limited Performance Share Plan (as amended)
Profit after tax Profit after finance costs, tax, minority interests and Significant Items
RPCs Reusable/returnable plastic/produce container/crate, generally used for shipment and
display of fresh produce items
Glossary continued
ROCI
(Return on Capital Invested)
Underlying Profit divided by Average Capital Invested
SBT
(Science-based Targets)
Targets that provide a clearly-defined pathway for companies and financial
institutions to reduce greenhouse gas (GHG) emissions, helping prevent the worst
impacts of climate change and future-proof business growth
SBTi
(Science-based Targets initiative)
Initiative that drives ambitious climate action in the private sector by enabling
organisations to set science-based emissions reduction targets
Sharing economy An economic system in which assets or services are shared between different agents,
either free or for a fee
Significant Items Items of income or expense which are, either individually or in aggregate, material to
Brambles or to the relevant business segment and: outside the ordinary course of
business (e.g. gains or losses on the sale or termination of operations, the cost of
significant reorganisations or restructuring); or part of the ordinary activities of the
business but unusual because of their size and nature
STI Short-Term Incentive
TCFD
(Task Force for Climate-related
Financial Disclosures)
A framework to help organisations disclose climate-related risks and opportunities
TSR
(Total Shareholder Return)
Measures the returns that a company has provided for its shareholders, reflecting
share price movements and reinvestment of dividends over a specified performance
period
Underlying EPS
Profit after finance costs, tax and minority interests but before Significant Items,
divided by the weighted average number of shares on issue during the period
Underlying Profit Profit from continuing operations before finance costs, hyperinflation adjustments, tax
and Significant Items
Unification The unification of the dual-listed companies structure (between Brambles Industries
Limited and Brambles Industries plc) under a new single Australian holding company,
Brambles Limited, which took place in December 2006
Year Brambles’ 2023 financial year
GlossaryGlossary142 143
Notes Notes
Notes 145Notes144
Notes
Contact Information
Registered Ofce
Level 29, 255 George Street
Sydney NSW 2000
Australia
ACN 118 896 021
Telephone: +61 2 9256 5222
Email: [email protected]
Website: brambles.com
London Ofce
Myo, 123 Victoria Street
London SW1E 6DE
United Kingdom
Telephone: +44 20 38809400
CHEP Americas
7501 Greenbriar Parkway
Orlando FL 32819 USA
Telephone: +1 407 370 2437
5897 Windward Parkway
Alpharetta GA 30005 USA
Telephone: +1 770 668 8100
CHEP Europe, Middle East, India & Africa
400 Dashwood Lang Road
Bourne Business Park
Addlestone, Surrey KT15 2HJ
United Kingdom
Telephone: +44 1932 850085
Facsimile: +44 1932 850144
CHEP Asia-Pacic
Level 6, Building C,
11 Talavera Road
North Ryde NSW 2113
Australia
Telephone: +61 13 2437
Investor & Analyst Queries
Telephone: +61 2 9256 5238
Email: [email protected]
Share Registry
Access to shareholding information is available to investors
through Boardroom Pty Limited
Boardroom Pty Limited
GPO Box 3993, Sydney NSW 2001, Australia
Telephone: 1300 883 073 (within Australia)
+61 2 9290 9600 (from outside Australia)
Facsimile: +61 2 9279 0664
Email: [email protected]
Website: www.boardroomlimited.com.au
Share Rights Registry
Employees or former employees of Brambles who have queries
about the following interests:
Performance share rights under the performance share plans;
Matching share rights under MyShare; or
Shares acquired under MyShare or other share interests held
through Certane SPV Management Pty Ltd, may contact
Boardroom Pty Limited, whose contact details are set out above.
American Depository Receipts Registry
Deutsche Bank Shareholder Services
American Stock Transfer & Trust Company Operations Centre
6201 15th Avenue Brooklyn NY 11219 USA
Telephone: +1 866 706 0509 (toll free)
+1 718 921 8124
Notes146
