Shareholders grill Fletcher Building
Fire fallout and land protest key issues at annual meeting
Ihuma¯tao and the NZ International Convention Centre fire were key focus points of Fletcher Building’s annual meeting, with a number of shareholders and protesters quizzing the board.
Security costs at the Ma¯ngere site — $60,000/month was being spent — and whether insurance would indeed cover the fire, were topics raised at Eden Park yesterday.
Fletcher forecast $515 million to $565m operating profit in the year to June 30, 2020, compared to $549m last year.
Pania Newton, a shareholder and also of Save our Unique Landscape (Soul), asked about the board’s reaction to Heritage New Zealand examining listing the site as Category 1 “the highest protection”. Chairman Bruce Hassall said Fletcher was waiting to see what happens. Heritage NZ said this month it might extend the tuataua Stonefields. Whether the Government would loan Auckland Council around $40m to buy the land was not specifically mentioned.
Before the AGM, protesters gathered on Reimers Ave outside the venue, waving banners and flags, singing Tu¯matauenga, a waiata to the Ma¯ori god of war.
Hassall indicated frustration about Ihuma¯tao, saying the business had bought the privately-owned land in good faith, stopped work at Prime Minister Jacinda Ardern’s instructions, waited almost four months and hoped for a resolution by the end of this year.
Another shareholder asked about the inconvenience of Ihuma¯tao “and having money tied up” in the land.
Hassall said the matter was in the
PM’s hands and the board was hopeful of a resolution soon. Another shareholder queried security costs, hearing back from Hassall that the ball was in the PM’s court and nothing could be done in the meantime.
The board was also asked what the words “respond” meant in Fletcher’s Tuesday release about the NZICC site: “Does it mean they will pay?”
Ross Taylor, chief executive, said it meant the insurers had accepted liability and they would respond to claims: “It gives you confidence.” Asked again if he was confident of getting the insurance, Taylor said a process was involved, “working out
what it will cost”. In recent days, the insurers for the project have now formally confirmed that both the contracts works, and the third-party liability insurance policies will respond to damage and claims caused by the fire, said Taylor.
Tony Mitchell, NZ Shareholders Association chairman, asked about carbon emissions and the board’s commitment to sustainability. Hassall and Taylor emphasised the importance the board put on the issue and Taylor cited cement manufacturing and coal consumed in Australia.
Taylor told the meeting Fletcher intended to scale up its housebuilding activities to around 1000 units a year and tap into the housing intensification trend “hoping to crack the apartment market through innovative modular . . . systems.”
Questions were also asked about the share buyback where $106m has been spent so far on a possible $300m plan. One shareholder thanked the board for reinstating dividends and “turning the company around”.
Shareholders then gave the board a spontaneous round of applause.
Fletcher shares closed at $5.17 yesterday.