OK – managed to get to the AGM. Lets be honest these things are...

OK – managed to get to the AGM. Lets be honest these things are like dancing with your sister and unless you are a Tasmanian they are pretty hard to get excited about.

The media release put out in the afternoon sums up the meeting as both the Chairman and the CEO read from the script. I note the comments on the thread “Why Rest?” and I don’t have a lot to add to that.

As stated they would not be specific about a sales number for the 1st Qtr but to quote the release sales are ” Well above the same period last year and above the 4th Qtr of 2015”. So we know the 1st qtr last year was pretty ordinary so I guess it is up to us to estimate what they mean by “well above”. The fact that the sales number is above the 4th qtr is very good news as it shows that growth is continuing.

The Chairman - Bill Stevens – pretty boring old fella. Banged on about long and short term incentives and clearly a number of shareholders had raised concerns. However as not many incentive shares were issued I have no problem with what they are doing.

The CEO -Ross Sudano – is very impressive. I have been involved in the FMCG sector for nearly 30 years and I would rate him higher than the senior managers at Coles, Woolworths, David Jones etc. He has turned over his management team and clearly got rid of the dead wood. I am more than happy with the strategies he is adopting and his senior management are clearly aligned with the strategies (I spoke to them before and after the meeting).

A guy from the Australian Shareholders Association did ask a few questions but there was nothing controversial. Even stated that directors fees were reasonable and the company has a track record of being frugal in this area (a resolution to increase directors fees was passed – this was to bring in more directors – not to increase the fees).

For those concerned about dividends they did state that the 60% payout ratio will be maintained. However reading between the lines this and the full franking credit might be under stress in 2016/17 as they ramp up the new purpose built distribution centre in Truganina.

Overall I left the AGM more than happy that things are heading in the right direction. Will continue to hold and not be tempted to sell unless something changes dramatically.

Cheers

SLC