Brambles Limited · ASX:BXB
Brambles — Shareholder Meeting (October 2017)
68 slides from Brambles's shareholder meeting presentation, Oct 18, 2017
Slide 1: Annual General Meeting
Annual General Meeting 18 October 2017
Slide 2: Poll on all resolutions: voting card instructions
A poll is being held on all resolutions at this meeting. If leaving early, place completed voting cards in the ballot boxes by the exit doors. 2
Slide 3: Stephen Johns, Chairman
Stephen Johns Chairman Brambles
Slide 4: Graham Chipchase, CEO
Graham Chipchase CEO Brambles
Slide 5: FY17 result
FY17 result Statutory result impacted by non-cash impairments in discontinued operations FY17 Change vs. FY16 Actual FX Constant FX Continuing operations Sales revenue 5,104.3 4% 6% Underlying Profit 957.5 (3)% (1)% Interest, tax and Significant Items (512.6) Profit after tax 444.9 (25)% (23)% Disco
Slide 6: FY17 result: balance sheet remains strong
FY17 result Balance sheet remains strong FY17 FY16 Investment grade credit ratings from Standard & Poor's and Moody's Net debt/EBITDA 1.73x 1.70x1 maintained EBITDA interest cover 15.0x2 13.5x1 Recent €500m European medium-term Undrawn committed facilities US$1.5b US$1.5b note raising reflects acces
Slide 7: 1Q18 trading update
1Q18 trading update Solid growth delivered in a challenging operating and competitive environment US$m 1Q18 Change vs. 1Q17 Actual FX Constant FX CHEP Americas 546.2 6% 5% CHEP EMEA 438.2 12% 8% CHEP Asia-Pacific 118.6 (2)% (5)% IFCO 271.0 12% 9% Continuing operations 1,374.0 8% 6% 7
Slide 8: Vision and strategy
Vision and strategy Focus on core pallet, RPC and container pooling businesses We aspire to be: “The world-leading provider of supply chain logistics solutions, enabling our customers to make supply chains more efficient, safe and sustainable” Portfolio actions reflect focus on core pallet, RPC and
Slide 9: Investor value proposition
Investor value proposition Creating long-term value and attractive shareholder returns Brambles’ value creation model Delivering through the cycle: Sustainable growth at returns well in excess of the cost of capital; Mid-single digit revenue growth1; Underlying Profit growth1 in excess of sales reve
Slide 10: Operating and competitive landscape
Operating and competitive landscape Changing customer requirements and increasing competition Industry E-commerce and omni-channel developments accelerating pace of change Trend for consolidation in FMCG and retail industry Growth of hard-discount retailers and increasing need for shelf-ready
Slide 11: Focus on the core drivers of value
Focus on the core drivers of value Strategic priorities Grow and Deliver operational Drive disciplined capital Innovate to Develop strengthen our and organisational allocation and improved create new world-class network advantage efficiencies cash generation value talent Strengthen industry- Leverag
Slide 12: Strong foundation for value creation
Strong foundation for value creation Growth and attractive shareholder returns over the long term Strong business underpinned by market-leading positions and network advantage High-performance culture with a clear focus on delivering value to the customer Operational excellence and disciplined capit
Slide 13: Annual General Meeting
Annual General Meeting 18 October 2017
Slide 14: Tony Froggatt, Chairman of the Remuneration Committee
Tony Froggatt Chairman of the Remuneration Committee
Slide 15: What I will cover
What I will cover Brambles’ executive remuneration structure Outcomes for FY17, including share vesting Decisions made in relation to Short Term Incentive (STI) payments Proposed changes to our Remuneration Policy MyShare employee share ownership scheme 15
Slide 16: Executive remuneration policy
Executive remuneration policy Objectives Attract and retain high-calibre executives Incentivise executives to achieve challenging performance levels Reward successful business strategy implementation Align executive rewards with creation of shareholder value 16
Slide 17: Senior executive remuneration structure
Senior executive remuneration structure At risk remuneration Fixed remuneration (76%) (24%) At risk LTI shares (32%) Fixed salary Salary Vesting over three years, At risk LTI Superannuation, car, performance hurdles for shares shares healthcare, etc. related to TSR and sales revenue/BVA At risk At r
Slide 18: FY17 remuneration outcomes
FY17 remuneration outcomes Modest salary increases for senior executives Short-term incentives (STIs) and deferred share awards substantially lower than 2016 reflecting company performance Long-term incentives (LTIs) vested at 20% compared with 75% in 2016 No increase to Non-Executive Director fees
Slide 19: FY17 STI decisions
FY17 STI decisions No STI was paid to the former CEO No STI was paid to the former Group President, CHEP Pallets STI payments were reduced for other executives, including the former CFO 19
Slide 20: Changes to our STI Plan
Changes to our STI Plan Comprehensive review of our remuneration strategy in 2017 has recommended some changes to our remuneration policy and structure From FY18 we will move from BVA to Underlying Profit Increase in the proportion of STI based on financials from 70% to 80% Inclusion of a Brambles G
Slide 21: Proposed changes to our LTI Plan
Proposed changes to our LTI Plan We are seeking shareholder approval for changes relating to our LTI Plan The proposed changes only apply to LTI plan grants from FY18 onwards No changes to existing LTI plan structure or targets Introduction of an international comparator index reflecting the global
Slide 22: Proposed changes to our LTI Plan (cont'd)
Proposed changes to our LTI Plan (cont’d) Summary of proposed changes LTI Plan LTI plans to FY17 LTI plans from FY18 onwards External metric 50% based on Relative Total 25% based on Relative Total Shareholder Return against Shareholder Return against ASX100 Index ASX100 Index 25% based on Relative T
Slide 23: Changes to Executive Shareholding Policy
Changes to Executive Shareholding Policy Key changes include: CEO’s shareholding requirement will be increased from 100% to 150% of base salary to be built up over 5 years; and ELT members will not be permitted to sell shares other than to pay tax requirements until they have achieved 100% of their
Slide 24: Proposed changes to our Clawback Policy
Proposed changes to our Clawback Policy Brambles is proposing to strengthen our existing clawback arrangements to broaden the discretion to cancel STI and LTI share awards which have been granted but which have not vested 24
Slide 25: MyShare update
MyShare update Brambles strongly committed to employee share ownership Since initial launch in 2008, more than 4,000 employees in 40 countries have elected to participate MyShare employees now own 3.65 million Brambles shares 25
Slide 26: Final comments – remuneration
Final comments – remuneration Brambles remuneration strategy supports the business strategy Proposed changes enhance the alignment between executives and shareholders Our remuneration policy is designed to reward executives for the creation of shareholder value 26
Slide 27: Annual General Meeting
Annual General Meeting 18 October 2017
Slide 28: How to ask a question
How to ask a question Go to a designated microphone Show your red voting card or yellow non-voting card Give the attendant your name Wait until you have been introduced to the meeting 28
Slide 29: Voting procedure
Voting procedure Discretionary proxy votes given to Chairman will be cast in favour of each item of business 29
Slide 30: Item 1: Financial, Directors' and Auditors' Reports
Item 1 To consider and receive the Financial Report, Directors’ Report and Auditors’ Report for Brambles and the Group for the year ended 30 June 2017. 30
Slide 31: Item 2: Remuneration Report
Item 2 As an ordinary resolution To adopt the Remuneration Report for Brambles and the Group for the year ended 30 June 2017. 31
Slide 32: Proxies and direct votes received
Proxies and direct votes received Item 2 To adopt the Remuneration Report For Discretionary Against Abstain Proxy votes 878,737,615 4,976,105 267,405,092 20,201,425 Direct votes 16,186,987 - 3,158,481 - Total 894,924,602 4,976,105 270,563,573 20,201,425 76.46% 0.42% 23.12% 32
Slide 33: Mark your voting card
Mark your voting card Item 2 To adopt the Remuneration Report 33
Slide 34: Election of Nessa O'Sullivan
Election of Nessa O’Sullivan 34
Slide 35: Item 3
Item 3 As an ordinary resolution That Ms Nessa O’Sullivan be elected to the Board of Brambles. 35
Slide 36: Proxies and direct votes received
Proxies and direct votes received Item 3 That Ms Nessa O’Sullivan be elected to the Board of Brambles. For Discretionary Against Abstain Proxy votes 1,152,449,203 5,043,710 12,600,078 1,290,556 Direct votes 19,084,279 - 333,119 - Total 1,171,533,482 5,043,710 12,933,197 1,290,556 98.49% 0.42% 1.09%
Slide 37: Mark your voting card
Mark your voting card Item 3 That Ms Nessa O’Sullivan be elected to the Board of Brambles. 37
Slide 38: Re-election of Tahira Hassan
Re-election of Tahira Hassan 38
Slide 39: Item 4
Item 4 As an ordinary resolution That Ms Tahira Hassan be re-elected to the Board of Brambles. 39
Slide 40: Proxies and direct votes received
Proxies and direct votes received Item 4 That Ms Tahira Hassan be re-elected to the Board of Brambles. For Discretionary Against Abstain Proxy votes 1,086,968,611 5,008,499 79,320,970 1,286,364 Direct votes 17,581,020 - 1,840,387 - Total 1,104,549,631 5,008,499 81,161,357 1,286,364 92.76% 0.42% 6.82
Slide 41: Mark your voting card
Mark your voting card Item 4 That Ms Tahira Hassan be re- elected to the Board of Brambles. 41
Slide 42: Re-election of Stephen Johns
Re-election of Stephen Johns 42
Slide 43: Item 5
Item 5 As an ordinary resolution That Mr Stephen Paul Johns be re-elected to the Board of Brambles. 43
Slide 44: Proxies and direct votes received
Proxies and direct votes received Item 5 That Mr Stephen Paul Johns be re-elected to the Board of Brambles. For Discretionary Against Abstain Proxy votes 872,987,807 5,011,230 291,363,593 2,020,917 Direct votes 16,327,940 - 3,043,140 - Total 889,315,747 5,011,230 294,406,733 2,020,917 74.81% 0.42% 2
Slide 45: Mark your voting card
Mark your voting card Item 5 That Mr Stephen Paul Johns be re- elected to the Board of Brambles. 45
Slide 46: Re-election of Brian Long
Re-election of Brian Long 46 Brambles
Slide 47: Item 6
Item 6 As an ordinary resolution That Mr Brian James Long be re-elected to the Board of Brambles. 47
Slide 48: Proxies and direct votes received
Proxies and direct votes received Item 6 That Mr Brian James Long be re-elected to the Board of Brambles. For Discretionary Against Abstain Proxy votes 946,659,654 5,017,199 213,347,165 6,359,529 Direct votes 16,895,027 - 2,424,084 - Total 963,554,681 5,017,199 215,771,249 6,359,529 81.36% 0.42% 18.
Slide 49: Mark your voting card
Mark your voting card Item 6 That Mr Brian James Long be re- elected to the Board of Brambles. 49
Slide 50: Item 7: Amended Performance Share Plan
Item 7 As an ordinary resolution That the Brambles Limited 2006 Performance Share Plan, as amended in the manner described in the Explanatory Notes accompanying this Notice of meeting (the Amended Performance Share Plan), and the issue of shares under the Amended Performance Share Plan, be approved
Slide 51: Proxies and direct votes received
Proxies and direct votes received Item 7 Amendments to the Brambles Limited 2006 Performance Share Plan. For Discretionary Against Abstain Proxy votes 1,151,631,838 5,001,597 12,507,448 2,180,664 Direct votes 18,291,702 - 1,124,585 - Total 1,169,923,540 5,001,597 13,632,033 2,180,664 98.43% 0.42% 1.
Slide 52: Mark your voting card
Mark your voting card Item 7 Amendments to the Brambles Limited 2006 Performance Share Plan. 52
Slide 53: Item 8: MyShare Plan
Item 8 As an ordinary resolution That the Brambles Limited MyShare Plan (the MyShare Plan) and the issue of shares under the MyShare Plan, be approved for all purposes, including for the purpose of Australian Securities Exchange Listing Rule 7.2, exception 9. 53
Slide 54: Proxies and direct votes received
Proxies and direct votes received Item 8 Issue of shares under the Brambles Limited MyShare Plan. For Discretionary Against Abstain Proxy votes 1,109,142,987 4,972,598 54,950,739 2,252,460 Direct votes 18,154,080 - 1,186,056 - Total 1,127,297,067 4,972,598 56,136,795 2,252,460 94.86% 0.42% 4.72% 54
Slide 55: Mark your voting card
Mark your voting card Item 8 Issue of shares under the Brambles Limited MyShare Plan. 55
Slide 56: Item 9: Participation of Graham Chipchase
Item 9 As an ordinary resolution That the participation by Mr Graham Chipchase until the 2018 Annual General Meeting in the Amended Performance Share Plan in the manner set out in the Explanatory Notes accompanying this Notice of Meeting be approved for all purposes including for the purpose of Aust
Slide 57: Proxies and direct votes received
Proxies and direct votes received Item 9 Participation of Graham Chipchase, Executive Director, in the Amended Performance Share Plan. For Discretionary Against Abstain Proxy votes 983,846,137 4,910,269 177,667,198 4,896,943 Direct votes 17,457,268 - 1,896,139 - Total 1,001,303,405 4,910,269 179,563
Slide 58: Mark your voting card
Mark your voting card Item 9 Participation of Executive Director in the Amended Performance Share Plan. 58
Slide 59: Item 10: Participation of Nessa O'Sullivan
Item 10 As an ordinary resolution That the participation by Ms Nessa O'Sullivan until the 2018 Annual General Meeting in the: a) Brambles Limited Performance Share Plan (if the amendments to the Performance Share Plan under Resolution 7 is not obtained); or b) the Amended Performance Share Plan (if
Slide 60: Proxies and direct votes received
Proxies and direct votes received Item 10 Participation of Nessa O’Sullivan, Executive Director, in the Performance Share Plan or the Amended Performance Share Plan. For Discretionary Against Abstain Proxy votes 975,453,553 5,345,994 185,661,945 4,860,981 Direct votes 17,482,318 - 1,826,993 - Total
Slide 61: Mark your voting card
Mark your voting card Item 10 Participation of Executive Director in the Performance Share Plan or the Amended Performance Share Plan. 61
Slide 62: Item 11: Nessa O'Sullivan in MyShare Plan
Item 11 As an ordinary resolution That the participation by Ms Nessa O'Sullivan until 18 October 2020 in the Brambles Limited MyShare Plan in the manner set out in the Explanatory Notes accompanying this Notice of Meeting be approved for all purposes including the purpose of Australian Securities Ex
Slide 63: Proxies and direct votes received
Proxies and direct votes received Item 11 Participation of Executive Director in the MyShare Plan. For Discretionary Against Abstain Proxy votes 1,108,723,244 5,346,434 55,019,262 2,232,533 Direct votes 18,044,912 - 1,250,226 - Total 1,126,768,156 5,346,434 56,269,488 2,232,533 94.82% 0.45% 4.73% 63
Slide 64: Mark your voting card
Mark your voting card Item 11 Participation of Executive Director in the MyShare Plan. 64
Slide 65: Please deposit your voting cards at the exit
Please deposit your voting cards at the exit 65
Slide 66: The poll has now closed
The poll has now closed 66 Brambles
Slide 67: Annual General Meeting
Annual General Meeting 18 October 2017
Slide 68: Disclaimer
Disclaimer The release, publication or distribution of this presentation in certain jurisdictions may be restricted by law and therefore persons in such jurisdictions into which this presentation is released, published or distributed should inform themselves about and observe such restrictions. This