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Financial Performance Summary
GRDC’s total income in 2019–20, including Government contributions, was $173.2m. The revenue figure is 18 per cent lower than the forecast budget published in the 2019–Portfolio Budget Statement of $210.7m and 16 per cent lower than 2018–19. The reduction in revenue was a result of extraordinarily difficult grain growing conditions along the eastern states over the past two years. Levies in 2019–20 were the lowest since 2010 and 26 per cent lower than the forecast budget. This in turn reduced Government contributions by 15 per cent. The government contribution is aligned to the 3 year rolling average of Gross Value of Production.
Total other own source revenues were higher than expected due to increases in grant income from collaborative RD&E investment activities.
Total expenditure for 2019–20 was $5m below the forecast budget but $12m higher than the 2018–19 result. Reductions in expenditure reflect efforts to materially offset the reduction in revenues in 2019–20. When compared to 2018–19, RD&E expenditure was $8m higher. Additional supplier and depreciation costs were due to intellectual property related legal matters and adoption of new accounting standards. These were partially offset by lower accommodation and travel costs, as a result of the COVID-19 pandemic.
Overhead rates are 8.3 per cent (determined by allocating operating costs to RD&E activities) of total expenditure.
Changes in equity
GRDC’s operating deficit was $45.9m in 2019–20 compared to a budgeted deficit of $12.9m and a breakeven position in 2018–19. This deficit is the main reason for the decrease in equity to $217.5m, down from $263.0m at the end of 2018–19.
Statement of financial position and cashflow
The deficit in 2019–20 was primarily funded from a reserve of managed funds, which correspondingly have decreased by $45.9m over the period to $151.6m.
GRDC continues to invest in GrainInnovate and holds shares in unlisted companies, Australian Grain Technologies and Intergrain. These holdings are largely unchanged from 2018–19. The application of the new accounting standards for leases (AASB16) is notable in the statement of financial position, whilst other aspects are relatively consistent with 2018–19.