Travel firm under the gun again with AGM next week

They were called ‘bottom feeders’ by a shareholder of this high-profile Brisbane travel company, but now a Sydney-based investment firm is set to be a thorn in its side again.

SHORTSELLlNG firm VGI Partners is once again set to be a thorn in the side of Brisbane-based Corporate Travel Management when it holds its annual general meeting at the Marriott on Wednesday morning.

You might recall that last year Corporate Travel’s then chairman Tony Bellas and founder CEO Jamie Pherous used the AGM as a forum to bat away concerns over the freshly unveiled “red flags” that VGI had identified in the accounts of the hyper growth corporate travel agency. City Beat readers will recall that at the meeting veteran investor Howard Stack memorably referred to VGI as “bottom feeders.”

Corporate Travel Management managing director Jamie Pherous goes skiing

Twelve months on and VGI Partners and Corporate Travel continue to trade barbs with investors increasingly jaded as the company’s sluggish share performance has taken its toll on the one-time market darling.

Corporate Travel’s shares are down 47 per cent from their 2018 high and the acquisition strategy that fuelled the company’s growth has ground to a halt.

In recent months the company has had to contend with a slowing market for corporate travel bookings – particularly in Asia – as well as bearish analysis from Taylor Collison’s top gun analyst Adam Dellaverde and hedge fund wizard John Hempton.

GOING BANANAS

STILL on VGI and it’s been a month since City Beat tipped that the firm’s next bout of sabre rattling down among the mangoes and tomatoes at Rocklea might be just around the corner. What we could never have guessed was that it would come in the form of a 1000 word open letter to Brisbane Markets chairman Tony Joseph published in the business pages of today’s Courier-Mail.

The letter from VGI, the market’s biggest independent shareholder, runs through a catalogue of gripes over governance and performance – everything from reported profitability being halved in the past year to poor attendance at board meetings and questions over wasteful spending that’s allegedly led to a brand new $12 million carpark not generating any additional revenue.

Brisbane Markets chairman Tony Joseph. Picture: Renae Droop

There’s also the question of why the market’s property valuation is sliding at a time when most commercial property in Australia is being revalued upwards.

VGI has called upon Joseph, who also serves on the board of the Brisbane Broncos, to address these questions and more at the company’s AGM set down for 13 November, before calling for his resignation as a precursor to a “long-overdue and essential rejuvenation of Brisbane markets’ governance and management.”

Joseph has been in the chair for a quarter of a century. To put that in perspective he chaired his first board meeting not long after Trevor “The Axe” Gillmeister helped the Broncos to a 14-6 victory over the St George Dragons in the Winfield Cup and All for Love by Bryan Adams, Rod Stewart and Sting were in the charts.

‘BASELESS ATTACK’

TONY Joseph has fired back at VGI telling City Beat it “was the same baseless attack from the Sydney-based short seller we see every year ahead of the AGM. And every year shareholders at the AGM reject their claims.”

Joseph points out that if VGI believes “the Brisbane Markets are so badly run, why does it keeping buying more and more shares”. He said the company’s underlying operating profit before tax for the 2018/19 financial year of $15.28 million, was up by 1.93 per cent over the prior financial year, while the company’s total assets now stand at $379.4 million. “As our annual report detailed, we are focused on growing the Brisbane Markets with a number of major projects underway or completed,” he said. “In contrast VGI seems focused only on its own profits and attacking Queensland companies.”

CHEERS TO JEERS

PRIME Minister Scott Morrison did not disappoint the good old boys and gals of the mining sector at the Queensland Resources Council annual luncheon at the Brisbane Convention and Exhibition Centre on Friday.

“How good is the resources sector?” ScoMo asked more than 1000 mining executives, who managed to cheer between mouthfuls of Moroccan lamb salad, grilled fillet of beef and grilled chicken.

Prime Minister Scott Morrison speaking at the Queensland Resources Council Annual Lunch.

It was all a bit of a conservative love-in as ScoMo growled about “progressives” and greenies before warning “a new breed of radical activism is on the march.”

The only jarring note came when a reporter from Britain’s Channel 4 at the “sandwiches only” media table got booed when she asked ScoMo how he could support coal mining in Queensland given the government’s commitment to reducing carbon emissions. Ouch!

FROM DISHWASHER TO BOSS

A one-time dishwasher has provided embattled Queensland-founded restaurant chain Hog’s Breath with a feel good moment. Rising above news of store closures and former owners lambasting the brand, Toowoomba restaurant manager Scott Easterman has been crowned Hog’s Breath’s franchisee of the year. The 36-year-old’s road to success started in 2002 in the NSW central coast town of Tuggerah when, after leaving school with his HSC in-hand, he started washing dishes. In 2010 he arrived at Toowoomba as manager before jumping in head first to buy the franchise five years later.

Scott Easterman with Hog’s Breath chief executive Ross Worth