First strike against Evans Dixon report

Financial services firm Evans Dixon was hit by a first strike against its remuneration report.

Tony Pitt; CEO of 360 Capital, in their Sydney offices.

Already under pressure, financial services firm Evans Dixon was hit by a first strike against its remuneration report in a move driven by corporate raider Tony Pitt, who had built up a 19.55 per cent stake in the company.

Evans Dixon copped a 34.7 per cent vote against its remuneration report in what is seen as a shot across its bows by Mr Pitt, whose 360 Capital unveiled a takeover proposal last month.

The vote at the company’s annual general meeting was arguably magnified as the many staff on the register were unable to vote on the resolution.

Mr Pitt, who did not ask questions at the meeting on Wednesday, is seeking control of the firm via a cash and scrip proposal and reached out directly to staff, who dominate the register, inviting them to contact him about his plans to make the company a bigger player in financial advice.

A separate resolution to grant Evans Dixon staff rights and options packages, which Mr Pitt indicated he opposed, was narrowly passed at the AGM.

The passing of the resolution, despite a 46.12 per cent vote against the move, meant that 360 Capital could pull its takeover plan for the $145m company as it was conditional on the resolution being pulled or failing.

Executive chairman David Evans faced questions about the company’s response to 360 Capital’s takeover proposal but said it was yet to even be formalised via the bidder’s statement.

He said 360 Capital’s offer was an unsolicited, unexpected and highly conditional offer to acquire the shares of Evans Dixon that it did not already own.

The company also declined to comment on action by the corporate regulator against its Dixon Advisory arm, which relates to the selling of its underperforming US property fund. It is defending the action.

Mr Evans told the meeting the year was also marked by the financial and operational challenges in the second half from the COVID-19 pandemic, which, combined with moves to overhaul the business, had led to a softer but relatively resilient financial performance.

Net revenue for the group was down 10 per cent compared with fiscal 2019, affected by pandemic-driven weaker second half revenues in E&P and funds management.

The group delivered underlying earnings of $37.2m for fiscal 2020, a 16 per cent lower than last year. Funds under advice was flat compared with 12 months prior at $20.1bn, although some clients left Dixon Advisory.

Funds under management dropped 1 per cent with growth in its solar infrastructure business, US Solar Fund, and strong performances across core equities portfolios offset by asset sales and portfolio writedowns in its troubled US property fund.