13 questions asked at 2021 Humm Group AGM
November 18, 2021
Here is the text of the 13 questions Stephen Mayne asked at the 2021 HUMM Group AGM held on November 18.
CHOICE Magazine awarded Humm its "stinkiest product" award this year. Could both the chair and CEO comment on how damaging this in and whether we have amended the product given the reputational risk that we'll tarred with the brush of just being a "glorified pay day lender".
Will the takeover of Afterpay by Square create market opportunities for us given that a lot of Australian Afterpay shareholders are expected to sell out rather than switch into Square CDIs
What has the float of both Latitude and Liberty meant for the competitive environment for Humm over the past 18 months. Latitude is particularly reliant on Harvey Norman. Does Humm group do more business with Harvey Norman than Latitude?
Andrew, well done on being the founder of the company but isn't it time that Humm Group had an independent chair? Are you intending to serve a full 3 year term and is it standard practice for the board to resolve on the chairmanship at the first board meeting after each AGM. Do you have board support to remain non-independent chair for the forseeable future? Could the lead independent director please also comment on this issue.
Please explain why we went so heavily into Jobkeeper, claiming $9 million for 395 Australian staff across 2 financial years when companies of our size required a 30% drop in revenue to qualify? Why didn't we repay any of this money like so many of the 474 listed companies which accessed JobKeeper have done. Does the chair agree that JobKeeper has become a notoriously wasteful scheme with $38 billion of the $88 billion going to employers which didn't satisfy the revenue drop requirements of the scheme. Is it prudent for us remain in the top 1% of JobKeeper claimants in Australia given the reputational damage?
John Wylie's Tanarra Capital was recently instrumental in Kerry Stokes seizing control of Boral despite board opposition when he sold his circa 4% stake into the Seven Group takeover. Could the chairman comment on whether Mr Wylie is agitating for a change of control transaction at Humm and is Andrew as the founder determined to keep the company independent, even if a big takeover offer is made. Also, what is the average price Tanarra and the chair paid for their stakes?
The chairman remains the largest shareholder with 13.46% of the company but like all shareholders, won't be enjoying the drop in the share price from $2.40 in mid-2019 to just 83c at the moment. Could the chair comment on whether he has pledged his shares to any financiers and whether he could potentially face margin calls if the stock continues to fall.
Did any of the 5 main proxy advisers in the Australian market - ACSI, ASA, Ownership Matters, Glass Lewis and ISS - recommend a vote against any of today's resolutions? Which of the proxy advisers are covering us and has their been a material proxy protest vote against any of today's resolutions? Will you disclose the proxy votes before the debate on today's resolutions so shareholders can ask questions if there have been any protest votes?
Given the interesting discussions across a range of topics today, could the chair undertake to make an archived copy of the webcast plus a full transcript of proceedings available on the company's website. Nine Entertainment chairman Peter Costello, who appreciates the benefit of a parliamentary hansard transcript where MPs don't have to scroll through old videos to find out what was said, made this change last week & had a full transcript of Nine AGM online before the end of the day. Given that Drew wanted to follow Peter Costello into Higgins, will be follow his lead on AGM transcripts?
Treasury Wine Estates has voluntarily moved to annual elections for directors in line with best practice that occurs in both the US and the UK. Dual listed companies like News Corp, BHP and Rio Tinto all do this due to the laws in the US and UK. Given director John Wylie is a strong advocate for best practice corporate governance, is he prepared to counsel the board and our non-independent chair to turn Humm into a small cap pioneer on this question. Mr Wylie used to advise BHP and BHP has promised to voluntarily keep annual elections even after dissolving its DLC and returning primarily to the ASX next year.
When disclosing the outcome of all resolutions today, will the chair support the idea of publicly disclosing how many shareholders voted for and against each item, similar to what happens with a scheme of arrangement? This will provide a better gauge of retail shareholder sentiment on all resolutions and was a disclosure initiative recently adopted by Metcash and Southern Cross Media after their AGMs. What does the chair think of this idea?
Tanarra only has 4% of Humm yet was given a board seat through John Wylie. How is this appropriate when he railed against Seven Group receiving two board seats at Boral when it owned more than 20% of the company. Would every 4% shareholder in Humm be given a board seat or did John get a special deal? That said, he is a highly capable director so don't sack him just now for only owning 4%. At least he has real skin in the game.
Thanks for reading out all of my questions unedited today although it is better practice to disclose the identity of questioners. I'm trying to set a world record today by asking question at 6 online AGMs in one day and had to bail at 5pm for Minerals Resources, so apologies for cutting things short at 13 questions. Looking forward to watching the webcast later and reading the transcript, if you produce one. Is Carole prepared to vote for the AGM transcript, annual elections or voting results by shareholders as well as shares, like with a scheme. Could Carole please address the meeting on these matters.
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