Ranging widely at Austereo AGM in 2001
By Stephen Mayne
February 13, 2008
We always like tackling media companies, and Austereo in 2001 yielded plenty of good exchanges, as this Crikey report at the time demonstrates.
Well the first ever Austereo AGM was fun today. When it came to general questions, shareholder Keith Myer and Crikey took it in turn asking about six each.
Chairman Peter Harvie found himself saying no comment or hiding behind confidentiality on a number of fronts including the negotiations with the AFL over radio rights and the recent settlement between Village Roadshow and DMG over the bogus letter writing campaign run by former Turnbull Porter Novelli director Ken Davis.
Austereo is well managed and the four executive directors - chairman Peter Harvie, CEO Brad March, finance boss Brian Bickmore and sales boss Michael Anderson - get paid handsomely with combined bonuses of $2.5 million last year after successfully getting the float away.
The lamentable Kirby brothers and Village CEO Graham Burke all sit on the Austereo board when the management would probably love to be completely divorced from all that controversy that has made Village the most unpopular stock with institutions in the top 200.
The four pages of related party transactions are unavoidable given that Village controls 55 per cent of Austereo but it should be spelt out in more detail so we can tell if they are getting any special rates.
Speaking of related party deals, I threw a question in about group program director Jeff Allis who owns a string of fruit juice shops called Boost Juice and Max's Place in Fairhaven which is where parts of Mad Max were filmed.
Harvie was quite open in saying that when they negotiated their five year deal with Allis, it included a specific amount of advertising on Austereo stations for these businesses.
This led to the next question about the contingent liability of $35 million for "termination benefits under personal service agreements for executives".
Whilst on-air talent and "personalities" don't get included in the "executives" tables when revealing who the highest paid employees of a company, Brian Bickmore revealed that this figure include possible payouts for on-air stars like Andrew Denton and Wendy Harmer and those payable to executives who get fired.
POLITICAL DONATIONS
The final contribution from Crikey covered the issue of political donations given that Village Roadshow has given more to the Liberal Party ($3 million) than anyone else over the past 5 years.
I expressed concern that holders of government licences who benefit from delays in issuing new licences would be paying the government huge sums of money.
And given than a Melbourne-based Austereo insider last year emailed us the following information:
"In the lead up to the 1999 Victorian state election, all advertising air-time was given to the Liberal Party leaving nothing for commercial clients and no room for other budgets."
I asked how much of the $3 million was free air-time and how much cash.
Harvie basically fudged this one and there were no disclosures in the annual report. However, he launched into a general moan that political parties over-spend on television and newspapers without going for the most immediate medium of radio.
And he complained that politicians are always ringing up to announce their policies on radio but then don't follow through with the paid ads. This is called the separation of church and state Peter. You don't buy yourself onto the news, you should be assessed on the merit of what you have to say.
The meeting concluded with a discussion about "standards" as Keith Myer complained about the PM being asked on Fox about whether he farts. Harvie noted that his answer: "I think I'll pass on that one" was most appropriate.
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