In 2017, our chairman Nick Falloon
presented to various bankers that Fairfax was aiming for Domain to deliver
EBITDA of $185m in financial year 2020-21. How did we only achieve $106 million
when the business generated $120m of EBITDA the year before the float? Have we
really delivered no profit growth in 4 years?
Answer:
it has a been a tough 4 years.
Did any of the 5 main proxy advisers
in the Australian market - ACSI, ASA, Ownership Matters, Glass Lewis and ISS -
recommend a vote against any of today's resolutions, including the remuneration
report? Which of the proxy advisers are covering us and has their been a
material proxy protest vote against any of today's resolutions? Will you
disclose the proxy votes before the debate on today's resolutions so
shareholders can ask questions if there have been any protest votes?
Answer: They
are all in favour of all items.
Greg Ellis is a former CEO of REA so
has great visibility into the Australian property listings market. What is
Greg's view on why REA is now capitalised at $21.65 billion, 6.4 times Domain's
market capitalisation of $3.38 billion. Why
haven't we bridged the gap during the period he has been on the Domain board?
Answer: Best
answered by sharemarket analysts because Greg doesn't believe REA is 6.4 times
more valuable than Domain.
Congratulations to Mike Sneesby on
his promotion to CEO of Nine Entertainment. Nine is currently capitalised at
$4.82 billion and Nine's 59% stake in Domain is worth $2 billion with the stock
at a record high of $5.80. What is so special about 59% and why hasn't Nine
opportunistically bought or sold Domain shares during the ups and downs of the
market. We could have topped up with another 3% at less than $2 a share in
April last year.
Answer: we're happy with 59%.
Why hasn't Domain ever run a moral
campaign against REA, pointing out that it is controlled by the unethical
Murdoch family which backed Donald Trump and promotes climate denialism world
wide. Many property owners and real estate agents might switch their business
from REA to Domain if the various News Corp atrocities were better known to
them. Get on the front foot against the Murdoch bullies, for once.
Answer: We'll
just focus on running our business but thanks for the suggestion.
Was the $120m pre-float EBITDA
forecast assisted by an increase in commissions Fairfax paid Domain for selling
commercial real estate and have these commissions subsequently been reduced to
more sensible commercial levels. Could you increase transparency and disclosure
about these inter-company dealings between Nine and Domain.
Answer:
All related party transactions are appropriate and fully disclosed.
There was some media last year about
Domain funding a golf membership that was accessed by the chairman or a member
of his family. Could the chairman comment on this situation, along with one of
the independent directors. Also, is it correct that the chairman's personal
home featured on the cover of Domain. Was that appropriate and was this full
disclosed at the time?
Answer: chair Falloon said the golf
club situation was an issue for Nine and also clarified the house sale in an
answer which even attracted
interest from Nine's own gossip columnists.
Congratulations on the decision to
repay $5.7m in JobKeeper, which we didn't need and didn't qualify for. Could
Diana comment on whether this a decision imposed on us by 59% shareholder Nine
or something that the Domain board resolved independently. Could Mike Sneesby
and Nick Falloon comment on whether it is correct that Nine chairman and former
Federal Treasurer Peter Costello is a vociferous critic of JobKeeper and wanted
public companies he was associated with to avoid it like the plague.
Answer:
it was a Domain decision.
Thanks for disclosing the proxies
ahead of the debate on each resolution. Could Jason comment on how important
this LTI grant is to keep him motivated. Also, given the interesting
discussions across a range of topics today, could the chair undertake to make
an archived copy of the webcast plus a full transcript of proceedings available
on the company's website.
Answer:
nothing particularly insightful.
Could Mike Sneesby comment on how
much of his time he is spending on Domain and how well he feels that he now
understands the business, relative to Stan, Nine's TV operation and the
traditional Fairfax newspaper operation.
Answer:
Yes, I'm getting up to speed.
Could Diana Eilert comment on whether
she believes Domain could flourish as an independent company if Nine was to
sell out, similar to the way that Carsales has flourished since decoupling from
Nine and Seek has flourished since PBL sold its 25% stake. How dependent on Nine is Domain, in her
opinion?
Answer:
it's an important relationship but we could thrive independently too.
Greg Ellis made more than $10m during
his time as CEO of REA Group. Does he retain any REA shares and why does he
only own 10,581 shares in Domain. Why not show some more confidence in the
Domain business and get some serious skin in the game, like what happened at
REA.
Answer:
Some more Domain shares will show up shortly and he never owned more than
11,000 REA shares and owns none now.
Next year, could general business questions please
be asked during item 1 covering the accounts. There was no drop down box for
item 1 when lodging questions today.
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