I address this post to the comments made by Rawiller, Whallm, Gycor, and Bohannons vest. I too have been a shareholder for many years and have posted much about the company, more recently, not so much.
I would draw your attention to DM's annual address to shareholders last November which gave a very full and honest appraisal of the position of the company.
David addressed the situation with:
- Icity
- Waste to energy conversion
- CertainID
Let me give my take on each of these points
Firstly Icity, personally I was outraged at the result of that investment. I was at the AGM following the announcement and heard Paul Beddie assure the shareholders of the success of Icity (in fact I believe he personally "guaranteed" it). As a result of my cynicism I contacted DM as many of you also did and was told that the proposal was carefully vetted by the Board (excluding Charles Hunting) and apparently the projections were again vetted independently by RMS accountants. Clearly the board got it wrong as did RMS accountants. Whom ever was at fault, be it Paul Beddie or the Board or RMS accountants is immaterial the Board was responsible and did not get this right. I am prepared to accept that these days projects must advance on faith however it would seem to me that the Board laid a great dollop of faith in the beliefs of Paul Beddie. The fact that the previous shareholders of Icity received shares, while regrettable was part of the deal approved by shareholders in the AGM. I was personally told by DM that the board examined every legal course of action in order to try and recover the shares issued to that group, but to no avail. However I would like to point out to Rawiller that his statement that those shareholders now own 20% of Kollakorn is incorrect. From my recollection of the Information Memorandum its more like 12%. The 20% threshold was only to be reached on meeting the profit targets which they clearly did not.
I remain unhappy at the outcome of the Icity deal and the loss (which was a book loss) that Kollakorn took, but I am prepared to accept the apology (falling on his sword) that DM gave in his address last year and move on.
Secondly Waste to Energy, the company has had success here in signing Memorandums of Information and aligning itself with some of the leading organisations in the world. These introductions were in fact one benefit from Icity that was positive. DM covered this in some detail in his last Annual Address. Clearly the progress has been slow in this area however I do not believe that the effort that the Board and management are putting into this has not diminished in any way. There are many companies out there that have competing technologies in this area and the fact that the Board does not announce every move it makes to shareholders comes as no surprise to me. I think it is fair to report on this matter once a year at the AGM.
Thirdly CertainID, The company has progressed its CertainID with CSIRO and their IT Security Division, Data61 and (as recently announced) its joint venture with the Singapore company. Again this in my view has been too slow however, and I am guessing, this is due more to the shortage of capital to advance the project than anything else. It has always baffled me as to how exactly shareholders perceive the financial circumstances of the Company. It has been many years since shareholders have been asked to contribute capital (even for the acquisition of Icity) however many shareholders expect cash to materialise when needed. Frankly, the achievements and there have been achievements, have occurred because of the fact that the Board and people like RS and DM have worked for years for no cash remuneration, capitalising their outstanding remuneration into shares and putting themselves in the same place as the shareholders - reward upon success.
Malaysian Tags, from last years CEO's Address DM said that "I
n Malaysia, we continue to work diligently to progress the opportunity with our local partner. Elections in May of this year resulted in a change of government and as a result, and not dissimilar to Australia, all government development projects were put on hold until they could be reassessed by the new Ministers". I have no reason to doubt that this diligence has been continued by the Board, but again because of the competition in this area the Board is prevented for commercial reasons to give a blow by blow information stream to shareholders. I look forward to hearing about the progress at this year's AGM.
Whallam, shareholders are entitled to know what is going on as required by Section 3 of the ASX listing rules, however this is only when the announcement will have a material impact on the share price. There is no obligation for directors to hold separate conversations with shareholders that give them access to exclusive information. In my view this Board is a professional and competent one, and should an announcement, both good or bad, be required they would have made it therefore I simply regard it as slow progress
not "NO" progress.
Gycor, your comment about the departure by RS after 10 years of service to the company was uncalled for. If you do not know, and I have no reason to suspect that you do not, as it was widely known in Kollakorn, RS retired after the first of 3 heart attaches and then went on to have open heart surgery. I do however believe you are correct in that he did work for "Nada" for at least the last 4 years of his tenure.
The Board has recognised, as may be seen from the CEO's address, that a different strategy was needed. They are following this, Icity was not their finest moment, but I am prepared to accept that the Board did everything they could to try an get back value that was lost. Do we really want to bring down an ASX investigation some 3 years later, that will divert management's attention from more productive efforts?
