- Release Date: 04/12/12 15:59
- Summary: MEETING: DGL: DGL - Chairman's Address to Annual Meeting
- Price Sensitive: No
- Download Document 8.26KB
DGL 04/12/2012 13:59 MEETING REL: 1359 HRS Delegat's Group Limited MEETING: DGL: DGL - Chairman's Address to Annual Meeting Delegat's Group Limited (DGL) Chairman's Address - Annual Meeting of Shareholders 2012 I am pleased to again report an excellent result for the year to 30 June 2012, delivered in line with the guidance provided back in December last year at our Annual Meeting. This result was achieved in spite of the on-going global economic issues which confront us. For the future operating plans I will leave that for Jim to cover in his Managing Director's Address. FINANCIAL HIGHLIGHTS. (Slide 1) Each year I have spoken of achieving new records - this year is no exception. I have previously stated and continue to do so that the Statement of Cash Flows, as a result of IFRS, is the dominant information source within our Financial Statements. Accordingly the Cash Flows from Operating Activities registered another record at $49.6 million and after further investments in vineyard development and winemaking plant led to a net reduction in borrowings of $29.0 million or 24%. Each of the major statistics can also be regarded as exceptional given the Company's growth strategy and the ongoing negative impact of the industry's supply imbalance which has led to a significant amount of bulk wine for the discount market. The results achieved are testimony to the strength of the Oyster Bay brand and the business model that all segments of the Group relentlessly pursue. This business model developed to support the long term strategic goal of the Group has proven to be both resilient and robust. This business strategy incorporates the four key success factors against which we measure ourselves and indeed measured by the market analysts. I will not dwell on the impacts that valuation issues under IRFS have on financial statements save to say that they are of themselves 'non cash' and hence my wanting to comment only on the results of the main drivers of the business. The other financial highlights include the Group successfully improving profitability on a targeted reduction in case sales resulting in Operating NPATof $25.6 million, up 7% on last year. Your Board were delighted to increase the full year dividend to 9 cents per share, an increase of 12.5% from the previous year. Shareholders are well aware of Delegat's strategy to seek out growth and value markets as the primary drivers of quality and sustainable growth - this underlies all the Group's forward planning. Your share price has increased by 61% since our last meeting and up 17% since June 2012. Your Board's priority is to grow Shareholder value. We will continue to seek all opportunities that are wealth accretive to ensure Delegat's sustainable growth continues. OPERATING PROFIT PERFORMANCE. (Slide 2) At our last Annual Meeting we announced plans to increase our selling prices of our wines in both of the UK and Ireland markets - with the obvious result which would lead to a reduction in volume by an estimated 30%. Overall for the Group the total volume variance for the year is 6% - the strategy of identifying and engaging volume and value markets achieving Group objectives. Accordingly achieving 1.850 million cases, only 119,000 cases fewer than last year, is a solid performance. Operating EBIT (which takes out the IFRS adjustments) at $43.5 million generated an Operating NPAT of $25.6 million or an equal record (with 2009) of 12% of Sales Revenue. Given that sales in countries other than New Zealand represent 95% of total sales which when coupled with the on-going strength of the NZ$ is indeed a creditable performance. This generated operating EBIT covers the Groups finance costs 5.69 times. Your Board is aware of the progress to the standardisation of reporting required by the Australian Securities and Investment Commission (ASIC) in Australia and the announcements by the Financial Markets Authority in New Zealand to follow the lead. Accordingly I refer you to the detailed Notes in the Financial Statements for a more fulsome explanation of any particular number. DIVIDEND DISTRIBUTION. Your Board being cognisant of both dividends to reward shareholders and the need for reinvestment for a growth company, which, with the confidence the Board holds for future revenue streams declared a fully imputed dividend of 9 cents per share this year - a 12.5% increase on the previous year. This was paid on 12 October 2012 to shareholders on record at 28 September. The Board is confident this dividend is sustainable on the basis of the Company's plan for growth and the ability of management to execute under the plan. BANKING FACILITIES Our relationship with our bankers Westpac is excellent and although already reported it is well worth repeating that this year Westpac released its securities over the assets of the Group supporting the borrowings - such is their confidence in the Group to continue to deliver under the business plan. DIRECTORS Your Board has from time to time received comment in respect to board composition and 'refreshment' of the Board has been a focus. As can be seen from today's meeting agenda John Maasland has retired. I would at this time thank John for his contribution to the Board of Delegat's Group since it listed as a public entity in 2004 following the very successful capital raise of a capital note issue. John who began his involvement with the Group in 1999 as a Director of our now wholly amalgamated subsidiary, Oyster Bay Marlborough Vineyards Limited, has had a significant influence on the Board and particularly as Charman of the Audit Committee, and I place on record mine and his fellow director's thanks and appreciation for his contribution over this time. Later in the meeting is your opportunity to confirm by vote the appointment of Alan Jackson to the Board - his Bio having been circulated with the notice of meeting. We continue to review our own performance and the composition of the Board with respect to experience and believe there is an appropriate structure and skill base to lead the Company forward, while at the same time recognising market and regulatory changes. DIRECTORS FEES Your Directors are very cognisant of the debates that have been held particularly during the course of this year on this subject matter. Your Board has considered the level of Directors' Fees which were approved by shareholders back in 2008 and note that the current level of Directors Fees are at the lower end of the scale of Companies of similar size and complexity. No increase is sought but is flagged that a further review will be undertaken prior to the next annual meeting in light of the increased responsibilities and obligations these positions entail. THE FUTURE As I said earlier I am leaving the detail of the Operating Plans to the Managing Director to provide you the information which gives us the confidence as a Board in the Group in continuing to grow market share from our internationally acclaimed brands in the increasing number of geographic jurisdictions we are penetrating around the globe. REVIEW Whilst we continue to be subject to all that goes on in the world we also continue to remind ourselves of the increasing value of stakeholder relationship in the broadest sense of the term. Accordingly your Board recognises and thanks you for your participation in the shareholding of the Group whilst at the same time acknowledging the input of suppliers of goods and services, whether they be physical or intellectual, which contributes to the high level of outcome expected in our wine products. Of special note is to acknowledge the high calibre of Delegat's staff domiciled throughout the world - creating a position for the brand that will enable the achievement of "to lead New Zealand category growth and establish Oyster Bay as one of the world's great Super-Premium wind brands". YOUR BOARD In closing and just to reiterate, we are part of an uncertain economic world but your Board and all the staff of the Group continue to strive to create shareholder value and continuously seek out wealth accretive opportunities for the benefit of shareholders and to thank each of my fellow board members for their involvement and contributions. ENDS For further information please contact Robert Wilton Chairman Delegat's Group Limited Telephone 64 9 359 7300 End CA:00230652 For:DGL Type:MEETING Time:2012-12-04 13:59:54
- Forums
- NZX - By Stock
- Ann: MEETING: DGL: DGL - Chairman's Address t
Ann: MEETING: DGL: DGL - Chairman's Address t
Featured News
Add DGL (NZSX) to my watchlist