Freelancer : 2021 Financial & Directors Report Correction

For personal use only

Freelancer Limited (ASX:FLN)

ACN 141 959 042

Level 37, Grosvenor Place

225 George Street

Sydney NSW 2000, Australia

P: [phone]

www.freelancer.com

22 February 2022

The Manager

Company Announcements Office

ASX Limited

Level 4, Exchange Centre

20 Bridge Street

SYDNEY NSW 2000

Dear Sir/Madam

FREELANCER LIMITED (ASX:FLN): CORRECTION TO NOTE 4 OF 2021 FINANCIAL AND DIRECTORS REPORT

We refer to the 2021 Financial and Directors Report, which was issued today.

There was an error in the segment revenue reported in Note 4. Operating Segments. This has been corrected and we enclose an amended Report.

Yours faithfully

Freelancer Limited

Neil Katz

Company Secretary

For personal use only

For personal use only

Contents
	Page
Directors' Report ............................................................................................................................................................	3
Review of operations .........................................................................................................................................................	4
Remuneration Report.......................................................................................................................................................	33
Auditor's Independence Declaration................................................................................................................................	37
Consolidated Statement of Profit or Loss and Other Comprehensive Income ..............................................................	38
Consolidated Statement of Financial Position .................................................................................................................	39
Consolidated Statement of Changes in Equity .............................................................................................................	40
Consolidated Statement of Cash Flows...........................................................................................................................	41
Notes to the financial statements .................................................................................................................................	42
Directors' Declaration.......................................................................................................................................................	79
Independent Auditor's Report ..........................................................................................................................................	80
Corporate Directory..........................................................................................................................................................	86

FREELANCER LIMITED 2021 FINANCIAL REPORT

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Freelancer Limited

Directors' Report

Your Directors submit the financial report of Freelancer Limited (the Company) for the year ended 31 December 2021. In order to comply with the provisions of the Corporations Act 2001, the Directors report as follows.

Directors

The names and particulars of the directors of the Company during or since the end of the financial year (Directors) are:

Matt Barrie	• Founder and Executive Chairman of the Company.
Executive Chairman (appointed	• Serial entrepreneur with extensive experience and knowledge in the technology
10 April 2010)	sector. Previously co-founded and was CEO of Sensory Networks Inc., a vendor
BE (Hons I) BSc (Hons I)	of high performance network security processors, which was acquired by Intel
Corporation Inc. in 2013.
GDipAppFin MAppFin MSEE	• Formerly Adjunct Associate Professor at the Department of Electrical and
(Stanford) GAICD SEP FIEAust	Information Engineering at the University of Sydney. Co-author of over 20 US
	patent applications.
	• Qualifications include first class honours degrees in Electrical Engineering and
	Computer Science from the University of Sydney, Masters in Applied Finance
	from Macquarie University, Masters in Electrical Engineering from Stanford,
	California, Graduate of the Stanford Executive Program at the Graduate School
	of Business, Fellow of the Institute of Engineers Australia and Councillor of the
	Electrical and Information Engineering Foundation at the University of Sydney.
	• Relevant interest in 195,919,185 fully paid ordinary shares, including a relevant
	interest in 1,916,754 fully paid ordinary shares by virtue of having a voting power
	of over 20% in the Company, which has a relevant interest as a result of trading
	restrictions over shares issued under the Employee Share Plan.
	• Beneficial interest in 194,002,431 fully paid ordinary shares (representing 42.87%
	of issued capital).
	• Member of the Nomination and Remuneration Committee and Audit Committee.

personal

Darren Williams Non-ExecutiveDirector from 1 November 2015. Executive Director until 31 October 2015 (appointed 10 April 2010)

BSc (Hons I) PhD (Computer Science)

• Non-ExecutiveDirector of Company. Was the Chief Technology Officer and Executive Director of the Company until 31 October 2015.
• Extensive experience in computer security, protocols, networking and software. Previously co-founded and was CTO (and subsequently CEO) of Sensory Networks Inc., a vendor of high performance network security processors, which was acquired by Intel Corporation Inc. in 2013.
• Previously lectured Computer Science at the University of Sydney. Author of numerous articles, patents and papers relating to security technology, software and networking.
• Qualifications include first class honours degree in Computer Science and a Ph.D. in Computer Science specialising in computer networking from the University of Sydney.
• Beneficial and relevant interest in 10,627,165 fully paid ordinary shares (representing 2.35% of issued capital).
• Member of the Nomination and Remuneration Committee and Audit Committee.

For

Simon Clausen	• Founding investor and Non-Executive Director of the Company.
Non-Executive Director	• Extensive experience in operating and investing in high growth technology
(appointed 10 April 2010)	businesses in both Australia and the United States. Previously founded and was
	CEO of PC Tools which was acquired by Symantec Corporation in October 2008.
	• Currently the sole director of Startive Ventures, a specialised technology venture
	fund that actively maintains investments in a number of companies globally.
	• Relevant interest in 162,416,754 fully paid ordinary shares, including a relevant
	interest in 1,916,754 fully paid ordinary shares by virtue of having a voting power
	of over 20% in the Company, which has a relevant interest as a result of trading
	restrictions over shares issued under the Employee Share Plan.
	• Beneficial interest in 160,500,000 fully paid ordinary shares (representing 35.47%
	of issued capital).
	• Member of the Nomination and Remuneration Committee and Audit Committee.

FREELANCER LIMITED 2021 FINANCIAL REPORT

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For personal use only

Freelancer Limited

Directors' Report

Company Secretary

Mr Neil Katz held the position of Company Secretary during and at the end of the financial year (appointed 9 March 2012). He has been with the Group since 2009 and is also the Chief Financial Officer.

Principal activities

The principal activity of the consolidated entity (the Group) during the financial year was the provision of an online outsourcing marketplace and escrow payment services.

There were no significant changes in the nature of the principal activities during the financial year.

Review of results and operations

The Group's loss attributable to equity holders of the Company, after providing for income tax, was $2,257,000 (2020 loss: $646,000).

Key Performance Highlights

	FY21	FY20	% Change
Year ended 31 December	$m	$m
Financial metrics:
Gross Payment Volume1	1,260	892	+41%
Net Revenue2	57.0	59.0	-3.3%
Gross Profit	47.7	49.0	-2.7%
Gross margin (%)	83.1%	83.3%	-0.2%
Operating EBITDA3,4	(2.7)	(0.4)	nm
Operating EBIT3	(3.0)	(0.7)	nm
Operating NPAT3	(2.1)	(0.5)	nm
Operating Cash Flow5	2.6	7.9	-67%
Operational metrics:
New Jobs6 (millions)	1.8	2.2	-18%
Total Jobs Posted (millions)	21.0	19.1	+10%
New Registered Users (excluding Escrow, millions)	7.6	8.9	-15%
Total Registered Users7 (millions)	58.2	50.8	+15%

Notes:

1. Gross Payment Volume (GPV) is calculated as the total payments to Freelancer and Escrow users for products and services transacted through the Freelancer and Escrow websites plus total Freelancer and Escrow revenue. GPV is an unaudited metric. Marketplace segment FY21 GPV A$180.4 million (down 6.1% on prior corresponding period), Payments segment GPV A$1,079 million (up 54.2% on prior corresponding period).
2. Net Revenue excluding Escrow.com for FY21 was $46.1m (down 8.8% on prior corresponding period).
3. Excludes non-cash share based payments expense of $156k in FY21 and $192k in FY20.
4. From FY19 lease expenses in respect of office leases have been accounted for in accordance with AASB 16 Leases. The impact is that lease expenses are no longer reflected in the P&L but are brought into account as depreciation on the right of use asset and interest paid on the corresponding lease liability. Depreciation of $4.6m (FY20:$4.5m) and finance costs of $2.0m(FY20:$1.8m) relating to office leases (accounted for in accordance with AASB 16 Leases) are included in the EBITDA calculation.
5. From FY19 lease payments in respect of office leases have been accounted for in accordance with AASB 16 Leases. The impact is that lease payments are now recorded in the cash flow statement as interest payments, disclosed in operating activities and capital payments, disclosed in financing activities.

6.	Total Projects and Contests Posted was redefined in January 2016 to Total Jobs Posted (filtered). Jobs Posted	(Filtered) is
	defined as the sum of Total Posted Projects and Total Posted Contests, filtered for spam, advertising, test projects,
	unawardable or otherwise projects that are deemed bad and unable to be fulfilled.
7.	User and project/contest data includes all users and projects/contests from acquired marketplaces. Prior to May	2009, all data
	was from acquired marketplaces. Includes Escrow.com unique users.

FREELANCER LIMITED 2021 FINANCIAL REPORT

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