6 questions asked at 2024 Fletcher Building hybrid AGM
October 25, 2024
Below is the text of the 6 written questions submitted at the 2024 Fletcher Building hybrid AGM held on October 23.
Q1. When it comes to plumbing supplies, the contrast between the performance of Tradelink and Reece has been stark indeed. What is it about the Reece business model that was so much superior to Tradelink?
Answer: Peter Crowley gave a detailed explanation on why Reece was so good and they were so bad. Watch video of exchange via Twitter, plus these additional comments by Peter Crowley.
Q2. The $700m capital raising was a shocker in so many respects. The pricing was too cheap, the $282m placement component too large and the the under-writing fees for Jarden too rich. Why did you cap the overs component for your 34,000 retail shareholders at 100% of entitlement, which contributed to the 27% retail shortfall and saw big end of town under-writers arranged by Jarden pick up the 13m in the money shortfall retail shares. When you add in the retail dilution from the over-sized institutional placement, you clearly owe us retail shareholders a $100m+ Share Purchase Plan to offset this needless dilution. Will the board undertake to give this serious consideration before next year's AGM?
Watch video of exchange via Twitter.
Q3. Did any of the 5 main proxy advisers - ACSI, Ownership Matters, Glass Lewis, ISS and ASA - recommend a vote against any of today's resolutions? If so, what reasons did they give and will you disclose the proxy votes before the debate on each resolution so shareholders can ask questions about the reasons if there have been any protest votes?
Answer: Peter Crowley said "we don't disclose proxy votes and that's the end of the matter". Just pathetic.
Q4. I'm writing this from Australia where remuneration report voting is compulsory under law. It is staggering that successive NZ Governments have failed to legislate mandatory remuneration report voting for NZSX listed companies and that most of your big cap companies refuse to put it up voluntarily. Well done for putting the remuneration report up for a vote today. Did you have to do it? Why did you do it and will you promise to keep doing it every year into the future whilst also lobbying the Luxon Government to get with the program and legislate so that NZ will stop being regarded as a governance backwater by international investors?
Answer: Peter Crowley declined to get political but seemed to commit to keep doing this. Watch video of exchange via Twitter.
Q5. I agree with Peter Crowley that Tony Dragicevich has delivered an impressive turnaround at Capral Aluminium and enjoyed his recent lengthy interview about this with Alan Kohler from The Intelligent Investor. However, as a Capral shareholder I'm disappointed that they didn't even make an ASX announcement saying that their CEO had been given time off to take on one of the most challenging board turnaround stories in Australasia. Could Tony comment on his moonlighting agreement with Capral and, if we're honest, wouldn't it make more sense to hire him as an executive?
Answer: not asked because Tony himself was a no show, perhaps demonstrating the workload challenge. It still should have been asked because the board ought to have a view on the workload issue. The company made contact two days after the meeting with the following response from Tony: “My appointment was endorsed by the Capral board. My non-exec director duties are primarily undertaken in personal time and do not adversely impact the performance of my role at Capral.”
Q6. I've asked questions at 860 AGMs since 1998 and that was the worst answer I've ever heard to a standard question inquiring about proxy adviser recommendations and proxy vote disclosure. Best practice is now to disclose the proxy position to the ASX/NZSX along with the formal addresses to offer more timely disclosure to the market? The likes of Origin Energy, NAB, Car Group, Viva Energy, Webjet, Xero, Myer, Brambles and JB Hi Fi all do this. Will you adopt this practice at next year's AGM and will you disclose the proxy votes on Andrew Reding's election now so we can have an informed debate about where investor sentiment is sitting at today's AGM? You've got the proxy voting data, stop hiding it from shareholders.
Answer: Brazen refusal by Peter Crowley. Just extraordinary. Watch video of exchange via Twitter.
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