Vocus Communications (VOC) 2015 AGM Report

Company/ASX Code : Vocus Group Limited (VOC)
Venue :
11am Grace Hotel (Marra-Kirralaa Room)
77 York St
Sydney, New South Wales
Monitor : Proxy Voting Representative
AGM Details / NoM : Wednesday 25th November, 2015
# of Attendees : Approximately 100
# Holdings represented by ASA : 41
Value of Proxies : $1.065 million
# Shares Represented by ASA : 150000
Market Capitalisation : $1.7 billion

Chairman David Spence introduced the Board with particular mention of the three new directors from Amcom. The Board has grown in size since completion of the takeover of Perth based Amcom Telecommunications.

Despite one shareholder commenting on the Board being able to make so many acquisitions without at all consulting shareholders, it was clear that shareholders were happy with the results. The company's performance in FY15 was solid with revenue increasing 62% and underlying EBITDA up 56%. The Chairman noted there were some shareholders in the room who had been shareholders since the get-go. Integration of the Amcom business was on track and proceeding well. The M2 Communications shareholder meeting to approve the merger is expected to be held in Janaury 2016.

CEO James Spenceley provided a comprehensive outline of the company's strategy and direction (unfortunately the slides were not provided to ASX). The acquisitions/mergers announced and completed in the year will strengthen the company's position going forward, increasing its fibre network and data centre presence in Australia. With the expanded and stronger infrastructure, it is envisaged that some of the M2 brands (Dodo and iPrimus) will be better positioned to compete with the likes of TPG and iiNet. Given the company's market share of about 8%, the company was confident there was more to gain than lose.  An interesting, and very valid, comment made by Mr Spenceley was that despite the company's size and market penetration, no one had heard of the name Vocus Communications. Shareholders will look forward to greater focus on marketing and branding by the company.

It was a well attended and informative meeting for a rapidly growing telecommunications company. Given the numerous acquisitions the company had made, shareholders were looking to understand the Board's strategy and direction. It was planned that Mr Spenceley would step down from the CEO role and take on a strategic position in the merged company in 2016. When queried about how he felt about this, Mr Spenceley gave a frank response - his strenths were in strategy, not management, and given the growing workforce the future CEO would have to manage, he was happy to let someone else do that job.

The three directors up for re-election (Tony Grist, Tony Davies and Paul Branding - all of which were Amcom directors) addressed the meeting and identified the contributions they would bring. Mr Grist's efforts in ensuring that the Amcom merger was successful when TPG attempted to block the transaction were commended by the Chairman. In response to a shareholder question, Mr Spence commented that the current Board size of 8 was probably reasonable.

All of the resolutions were unaminously passed on a show if hands, although the proxy results showed a 23% vote against on the resolution regarding termination benefits to Mr Spenceley.