• Times and locations of upcoming AGMs can be viewed here.   

• To read all our voting intentions and AGM reports, click here.  
• To learn how you can give us your proxies and set up a standing proxy, click here. 

Upcoming AGM Overview

The AGM season is well underway, and in December we will be hearing from the banks who work to a September year end. Interstate shareholders of Westpac and National Australia Bank will be breathing a sigh of relief, with both offering hybrid AGMs in line with our expectations of listed companies.

Unfortunately, however, investors in the ANZ Bank have fewer options to participate, with that organisation holding an in-person AGM at 9am on Thursday, 19 December 2024. Investors who cannot be there are encouraged to submit their proxy before the deadline – 9am AEDT on Tuesday, 17 December. Investors will be able to submit questions online, but there will be no remote voting.

ASA is disappointed with ANZ’s decision, which reduces the ability of retail shareholders to participate fully in the AGM process. Such choices can reduce accountability of management and the Board, reducing the trust that investors may have in the company leadership.

Trust was the theme of Steven Mabb’s article this month, emphasising that trust in the decisions of a company and how it treats its owners is essential to successful investing.

As the saying goes, “trust, but verify”. AGMs give shareholders the opportunity to question their management and to hold boards and executives accountable.  Restricting the ability to participate in these meetings is failing to treat shareholders with respect, and we do not think ANZ has made the right decision to abandon hybrid AGMs.

Voting Intention Reports published in the past week
This week, we have published the voting intention reports listed immediately below which you can read via the links on the headings.

Charter Hall Group (ASX: CHC) – AGM Wednesday 20 November 2024
As with other property businesses, interest rate increases led to increased capitalisation rates and falling property valuations, with consequent reduction to operating earnings and significant negative property revaluations. The security price increased for the year and during the early months of FY25 lifted further. We are supporting the resolutions at the AGM with remuneration and governance of CHC meeting our guidelines. HOWEVER, we want to call attention to resolution 7, reallocation of capital. It will have different after-tax impacts on investors depending on their circumstances.

For CHC, the reallocation of its capital within its business is not expected to generate a tax liability for the entity. If approved, the reallocation when it takes place will result in a notional payment (as in no cash paid) of a franked dividend and a return of capital to holders. The franked dividend will be required to be included in the holder’s annual tax return and for holders with a marginal tax rate of over 30% may attract a tax liability. Proxy givers should read our report and the notice of meeting and look at their own tax situation or seek advice, and then give a directed proxy that reflects their circumstances.

Northern Star Resources Ltd (ASX: NST) – AGM Wednesday 20 November 2024 
FY24 has been an excellent year for Norther Star with a 48% increase in cash earnings due to a realised gold price increase of 14.86% and 5.7% production increase. Northern Star made some changes to their remuneration this year, including extending the long-term incentive plan to 4 years. We are supporting the resolutions.

Evolution Mining (ASX: EVN) – AGM Thursday 21 November 2024
Evolution enjoyed positive gold and copper market fundamentals in the short and medium term benefitting from geopolitical changes and uncertainty, after a challenging 2023 due to unpredictable weather, accompanied by a 25% lift in dividend. At our meeting with the company, we discussed governance matters associated with founder-led companies. The founder and executive Chair, Jake Klein, relinquished the CEO/MD role to the former CFO Lawrie Conway, in January 2023. The company has recently rotated its lead independent director role from Jason Attew to Peter Smith. It considers such a rotation encourages diversity and a fresh set of eyes. We are supporting the resolution at the AGM.

Ramelius Resources (ASX: RMS) – AGM Thursday 21 November 2024
After a record profit due to the rise in the world gold price, shareholders were pleased to see the dividend increase from 3 cents per share to 5 cents per share. We feel the short-term incentive hurdles were not challenging in such an environment and will therefore be voting against the remuneration report. We will be voting in favour for the re-election of the Chair, the grant of the long-term incentives to the MD, as well as an increase to the fee pool, which will allow for an additional non-executive director.

Qube Holdings (ASX: QUB) – AGM Thursday 21 November 2024
Qube produced continued growth in profit, dividend, and share price with the diversity of the business, together with the geographic spread across Australian and New Zealand, protecting the company from the ups and downs that may affect specific markets or regions. Regrettably the safety centred company experienced the death of an employee at the company’s forestry harvesting operation in South Australia. While SafeWorkSA did not find any fault with Qube, the Board still exercised discretion to not pay Executives the safety component (10%) of their Short-Term Incentive. We are supporting the remuneration resolutions and director elections and re-elections. We are pleased to see that the Board is working through a process of very orderly renewal.

Pilbara Minerals (ASX: PLS) – AGM Tuesday 26 November 2024
With the rapid decline in the price of lithium, Pilbara Minerals has had a very tough year. Total revenue reduced to $1.38 billion from the previous year’s $4.1 billion, despite a 17% increase in production. To preserve capital, the company did not pay a dividend. Nevertheless, the share price remains ahead of the end of FY22 price as the company strives to reduce costs. We met with the new Chair, Kathleen Conlon, who was appointed Chair from 1 January 2024 to discuss this challenging period. We are supporting all the resolutions.

Lynas Rare Earths (ASX: LYC) – AGM Wednesday 27 November 2024
Lynas Rare Earths faced a more challenging year than last in FY24 as profits and prices for rare earths continued to fall largely due to fluctuations in supply and demand, geopolitical forces and a slowdown in EV demand. The new $800m Kalgoorlie Rare Earth Processing Facility finally produced its first mixed rare earth carbonate in June 2024 and was officially opened in November 2024. We met with the new Chair, John Humphrey, and our meeting focused on board renewal and succession planning. We also discussed a dividend. We are voting in favour of all resolutions but are looking to the company to address our requested improvements to the remuneration report, such as including a table of actual remuneration.

Harvey Norman (ASX: HVN) – AGM Wednesday 27 November 2024
We thank Harvey Norman for meeting with ASA to provide some colour and greater clarity on their public statements. The company ended a difficult year, with its share price somewhat intact, despite the fall in revenue and profits. Dividends were down to 22c compared with 25c for FY23. We continue to be disappointed with the board makeup, in terms of the dearth of independent directors and excess of executive directors. For this reason, we are voting against the re-election of the executive directors. We are voting in favour of the election of Christopher Herbert Brown, based on his relationship to the Norman family shareholding. We are also voting against the remuneration related resolutions. If there is a second strike on the remuneration report this year, we will vote against the board spill resolution because the KMP have stated they will vote for the election of the current directors so the spill meeting will be a waste of money.

Westgold Resources Limited (ASX: WGX) – AGM Thursday 28 November 2024
Another company benefitting from a surging increase in the gold price, Westgold had a great year with a Total Shareholder Return (TSR) of almost 70%. It has joined the ASX200 index in September. In August 2024, WGX made an “all scrip” offer to merger with Karora Resources, a TSX listed company with similar owner-operator areas in the Southern Goldfield. The merger brings together two similar sized companies with 1900 employees. We are supporting all the resolutions which include change of auditor from Deloitte from EY who were the auditor at the time of the initial listing. Given the growth of the company since listing, it was timely to consider what audit firm would suit.

In case you missed the reports published in prior weeks:

BlueScope Steel Limited (ASX: BSL) – AGM Tuesday 19 November 2024
The company has experienced reduced steel spreads, which impacted profitability. The North Star expansion project in the USA has been successfully completed and a further debottlenecking project approved, while at Port Kembla, the Blast Furnace relining and upgrade project is underway.

We are supporting all resolutions except the request for an increase to the feel pool and the number of directors. The company argues that this change is needed to enable knowledge transfer between incoming and outgoing directors, and to ensure appropriate experience, skills, and diversity of directors. In 2021, the board sought and received shareholder approval for a temporary increase in director numbers from ten to twelve, which is still in place and expires at the 2025 AGM. Its purpose was to ensure an orderly transition of directors. Since 2021, the board has not fully taken advantage of the new cap to enable the transition it sought. The director skills matrix indicates that at least nine of the ten directors have advanced capability in the main board skills required. We are concerned that having a higher permanent cap could promote a lack of discipline and rigour in succession planning, and that the opportunity remains in the next 12 months to utilise the temporary cap.

Monadelphous Group (ASX: MND) – AGM Tuesday 19 November 2024
Monadelphous has performed very well over the last year with double-digit growth in revenue, net profit after tax, earnings per share and dividend. For Board matters our only quibble is the tradition of Monadelphous to have an Executive Chair. Four of the six directors are independent, and a lead independent director, Sue Murphy AO, has been designated. The Executive Chair does not sit on the Audit and the Remuneration Committees. These two committees are entirely formed of the independent directors. We are supporting all the resolutions.

Sonic Healthcare (ASX: SHL) – AGM Tuesday 19 November 2024
The issues for the upcoming AGM for ASA are the use of “fair value” in the remuneration plan via the use of options in the LTI. We will be voting against the remuneration report and the LTI for the executive directors. We will support the re-election of Kate Spargo and the increase to the non-executive fee pool. In relation to the financial results, FY24 saw a rapid reduction in COVID related flows to the extent that this is now largely business as usual. Acquisitions are generally performing well, although there are some large acquisitions in more recent years (including FY24) that will take longer to realise synergies. There are several well-advanced initiatives in progress to improve the profitability of the business overall. The coming together of these disparate factors effectively means that FY24 is an inflexion point for the company and FY25 going forward should see cost reductions, improvement in profit margins and thus profitability.

Downer EDI (ASX: DOW) – AGM Wednesday 20 November 2024
Downer has enacted major changes to personnel and structure and is changing the auditor as the result of exceptional circumstances, which came to light late in 2022. Accounting irregularities were identified in its Australian Utilities business involving historical misreporting of revenue and work in progress in one of Downer EDI’s maintenance contracts, which had resulted in a historical overstatement of pre-tax earnings. We will be supporting the election of Peter Barker and the remuneration report and issue of equity to the MD. Overall, the company has a very good and detailed remuneration structure. We will also support the appointment of PWC as auditor after legal action has been commenced against the auditor at the time of the of the accounting irregularities, KPMG.

Worley (ASX: WOR) – AGM Thursday 21 November 2024
The Worley share price has decreased in 2024 after almost getting back to the levels it enjoyed in 2018 and 2019, although there was a hopeful lift on a 3-year basis with total shareholder return of 83.5%. In contrast, executive bonuses have increased with equity having been issued at the lower share price, which raises questions about the alignment between executive compensation and shareholder returns in more cyclical businesses. Consequently, we intend to vote against the adoption of the remuneration report and the grants of deferred equity rights and long-term performance rights to the CEO, Chris Ashton. ASA will vote open proxies in favour of the re-election and election of directors, approval of the company’s Employee Share Plan, and the changes to the company’s constitution.

Mineral Resources (ASX: MIN) – AGM Thursday 21 November 2024
The usual business for the AGM has been overwhelmed by the integrity issue where the CEO and founder of Mineral Resources had significantly profited from related party dealings with the company. The plan to redress the situation includes financial penalties to the CEO of $8.8 million, and loss of remuneration of up to $9.6 million and a 12–18-month transition to a successor. Mr Ellison apologised to the board and through them to the shareholders: “I am deeply sorry for the events that have occurred and the impact they have had on MinRes’ reputation”. He promised to tirelessly to bring back confidence. An Ethics & Governance Committee made of current independent directors has been established to further increase the separation between the company’s affairs and Mr Ellison’s personal affairs and improve the company’s internal controls. McClements who has chaired the company for 10 years has committed to step down at or before the FY25 AGM.

The 2024 AGM will be held 21 November. Past governance has been shown to be severely deficient and we shall ask why the chairman failed to take action earlier with respect to several matters dealt with below under ‘governance and culture’ in our voting intention report. We voted against the remuneration report last year and will do so again this year. The resolution for the issue of equity to the MD has been withdrawn as part of the raft of penalties applied in the face of the revelations. Two new independent non-executive directors are nominated for election. Both candidates have appropriate skills and experience to lend strength to the board so we will support their election.

NEXTDC (ASX: NXT) – AGM Friday 22 November 2024
NEXTDC was first listed on the ASX in 2010. It has recently entered the ASX top 50 companies by capitalisation ranking. The company describes FY24 as being the year Artificial Intelligence (AI) emerged as a “truly transformative technology, revolutionising economies and communities”. In our pre-AGM meeting, we queried the lift in FY24 capital expenditure to $1,003 million, which compared with guidance of $850-900 million and prior year capex of $695.7 million. We were told that additional investment opportunities arose throughout FY24, which saw capital raisings in May and September. We are supporting all the resolutions, including the re-election of the Chair who has held the role for 10 years and the increase to the director fee pool, given the rapid increase in the size and geographical focus of the company.

WiseTech Global (ASX: WTC) – AGM Friday 22 November 2024
On a purely operational financial basis the company had a great year. But after a period that reminded us of the company’s immaturity, which is in sharp contrast to its size, we have gone back to basics with a vote against the remuneration report and grant of equity to an executive director. We expect the remuneration framework to mature and be in keeping with an ASX200 company. We are supporting the director elections and an increase to the aggregate fee pool, as we encourage continued evolution of the board.

AGM Reports

Read about ASA at these AGMs:

Qantas, Domino’s, CSL, IGO, Bendigo and Adelaide Bank, Wesfarmers, Nine Entertainment Group, Fortescue, JB Hi-Fi, NIB Holdings, Jumbo