2021 Annual Report
Appen maintained its track record of profitable growth in 2021. The result featured a record second half revenue performance, breakout growth in China and an increased contribution from New Markets.
Group revenue increased by 8% over last year to $447.3 million and underlying EBITDA, also increased. Our performance is underpinned by the strength of our customer relationships, crowd model and ability to deliver high quality data.
The full year dividend of 10 cents per share was in line with FY20. Both the interim dividend of 4.5 cents per share and the final dividend of 5.5 cents were 50% franked.
Appen’s mission is to help our customers build better AI by creating large volumes of high-quality training data faster. In delivering on our mission, the Board is firmly focused on capturing growth opportunities. During the year, we completed a strategic review that confirmed the substantial opportunities ahead of us and our privileged leadership position and laid out recommendations to maximise our ability to grow and deliver value for shareholders. The Board has an active interest in the strategy implementation and has created an internal advisory board committee to advise management throughout the next phase.
I was very pleased to be invited to join the Board of Appen, commencing in August 2020 and thank Chris Vonwiller for his warm welcome and smooth handover before his retirement in October last year. Chris, along with his wife Julie, have created and grown an Australian success story and I am honoured to chair the company through its next phase. Chris has left Appen in a strong position and we wish Chris and Julie a long and happy retirement.
Bill Pulver also retired from the Board in 2021. Bill was CEO from 2010 to 2013 and then a non-executive director for eight years. I also thank Bill for his valuable contribution to the company and wish him well in the future.
Steve Hasker, an independent director since April 2015, was appointed as chair of the People and Culture Committee upon Bill’s retirement. The committee has been renamed and its remit broadened to reflect the importance of people and culture to Appen’s success. Steve is the President and CEO of Thomson Reuters and provides us with extensive experience in global talent and remuneration management.
With the retirements of Chris and Bill, we are actively recruiting for two new independent non-executive directors to join the Board. This will ensure we have the right mix of skills, experience and Board tenure to govern and guide the company.
The Board has listened to shareholders’ feedback in response to the first strike on the 2020 Remuneration Report. We have also taken feedback from proxy advisors and engaged remuneration experts to revise our short and long-term incentive programs.
The new incentive schemes, outlined in this year’s remuneration report, are designed to attract, motivate and retain employees, and better align their interests with those of our shareholders. Our 2022 programs seek to balance shareholder expectations against remuneration practices in the US and Australia, and enable Appen to compete for talent in these highly competitive labour markets.
We remain committed to the ethical treatment of our crowd and have set out our standards in our Global Ethical Sourcing and Modern Slavery Policy. We issued our first modern slavery statement in 2021 that summarises our ongoing commitments and efforts to address human rights and labour risks associated with our business.
As a company entrusted with the data of our customers, crowd, employees and shareholders, we have implemented rigorous security systems and processes based on international standards. This is a dynamic and important area, and our in-house experts are at the forefront of it to ensure we protect stakeholder data and privacy.
This year, we also partnered with the World Economic Forum to create responsible AI standards.
The Board has a strong interest in diversity and inclusion. AI requires diverse datasets representative of the real world to perform ethically and correctly, and we are obliged to ensure that our crowd is suitably diverse to deliver on this promise. We are actively involved in Impact Sourcing partnerships that support diversity and opportunity, and our Crowd Code of Ethics includes a commitment to offering work opportunities to individuals of all abilities and backgrounds.
We are also focused on gender and ethnic diversity amongst our full-time workforce. Appen has maintained 58% female representation amongst employees in 2020 and 2021 and increased female representation to 50% and 30% amongst our Board and Executive team respectively. Our employee-led Diversity and Inclusion committee maintains an active agenda of events and communications that celebrate diversity and promote awareness across the company.
This year, we completed our first GHG emissions inventory for Scope 1 and 2. While Appen’s business has a relatively small environmental footprint, we are committed to supporting international initiatives to transition to net zero emissions. As part of our commitment this year we will focus on determining our Scope 3 emissions and setting our pathway to achieve net zero by 2030.
Appen is a global leader in a dynamic and high-growth market. The Board has every confidence that Appen’s strong foundations and reshaped strategy will deliver long-term value for shareholders.
I thank my fellow board members for their welcome, congratulate management and their teams for their tireless efforts and resilience through the pandemic.
On behalf of the Board, I sincerely thank shareholders for your ongoing support and commitment to our company. Appen is a truly global company, and I am excited about its future.
Richard Freudenstein
Non-executive Chairman
