content_image/210588.jpg content_image/210582.jpg
## OPERATING AND FINANCIAL REVIEW (continued) 

## Business Objectives and Future Prospects (continued) 

## Business Risks (continued) 

– Development – the building of either new cinema sites or theme parks, both in Australia and overseas, involves inherent risks to such development projects, including cost and time overruns, community distaste for a project, regulatory hurdles and various governmental requirements and permissions. However, due to the diversity and scale of the VRL group’s other businesses, any adverse impact on the Group from any individual development or new operation, whether in Australia or elsewhere, is not expected to be material, and the significant expertise and experience of the Group in delivering such projects minimises this risk. 

## Future Prospects 

Subject to the business risks outlined above, and general economic risks and uncertainties, it is anticipated that the VRL group will continue to produce solid operating profits in future years. The Group has maintained a conservative net debt position and has enjoyed reliable cash-flows from its existing businesses. If this continues, the Group may be able to take advantage of potential future profitable development opportunities when they arise, which may include opportunities in Australia and elsewhere, with a focus on Asia. Specific future prospects for each division have been included in the Operational Results section above. 

The Group’s brands are well recognised and respected, and all of the Group’s businesses are focussed on ensuring that their customers have an enjoyable entertainment experience to encourage repeat visitation. The Company is committed to maintaining a consistent, stable dividend return to shareholders whilst retaining the flexibility for future expansion options. 

## SHARE OPTIONS 

Details of unissued shares under option, and shares issued as a result of the exercise of options, are set out in Note 19 to the Financial Statements. Details of share, option and “in-substance option” transactions in relation to Directors and Key Management Personnel of the consolidated entity are set out in the Remuneration Report. 

## INDEMNIFYING AND INSURANCE OF OFFICERS AND AUDITORS 

Since the commencement of the financial year, the Company has not, in respect of any person who is or has been an officer or auditor of the Company or related body corporate, indemnified or made any relevant agreement for indemnifying against a liability (including costs and expenses incurred in successfully defending legal proceedings) incurred as an officer or auditor, nor has the Company paid or agreed to pay a premium for insurance against any such liabilities incurred as an officer or auditor other than an un-allocated group insurance premium which has been paid to insure each of the Directors and Secretaries of the Company against any liabilities for costs and expenses incurred in defending any legal proceedings arising out of their conduct as officers of the Company or related body corporate, other than conduct involving wilful breach of duty. 

## REMUNERATION REPORT 

The Remuneration Report, which forms part of this Directors’ Report, is set out on pages 17 to 28. 

## DIRECTORS’ MEETINGS 

The following table sets out the attendance of Directors at formal Directors’ meetings and committee of Directors’ meetings held during the period that the Director held office and was eligible to attend: 

<img src='content_image/210588.jpg'>

Informal procedural meetings attended by a minimum quorum of three Directors to facilitate document execution and incidental matters are not included in determining the number of Directors’ meetings held. 

## TAX CONSOLIDATION 

A description of the VRL group’s position in relation to Australian Tax Consolidation legislation is set out in Note 4 to the Financial Statements. 

## AUDITOR INDEPENDENCE 

The Auditor’s Independence Declaration to the Directors of the Company, which forms part of this Directors’ Report, is set out on page 17. 

NON-AUDIT SERVICES PROVIDED BY AUDITOR Details of the non-audit services provided by the auditor are set out in Note 26 to the Financial Statements. The non-audit services summarised in Note 26 were provided by the VRL group’s auditor, Ernst & Young. The Directors are satisfied that the provision of non-audit services is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001 . The nature and scope of each type of non-audit service provided means that auditor independence was not compromised. 

## ROUNDING 

The amounts contained in this report and in the financial statements have been rounded (where applicable) to the nearest thousand dollars (unless stated otherwise) under the option available to the Company under ASIC Class Order 98/100. The Company is an entity to which the Class Order applies. 

Signed in accordance with a resolution of the Directors at Melbourne this 19th day of September 2014. 

<img src='content_image/210582.jpg'>

