On any score, Michael Clarke delivers for Treasury Wine Estates

Treasury Wine chief executive Michael Clarke. Illustration: John Spooner.

In August next year Michael Clarke will formally collect 514,283 shares, worth about $8.7m at today’s share price. It will be ­arguably his single biggest pay packet in what has been a lucrative innings at Treasury Wine ­Estates.

That suggests he is backing some upside between now and then before formally handing the reins to Tim Ford, who will be his replacement when Clarke leaves after pocketing at least $50m from his six years at the company.

Based on Monday’s close at $16.40, his shareholders have seen the stock increase by 4.7 times over the term.

The concept of a ready-made internal successor is appealing on one level but troubling on another because you would have thought the board would have tested the appointment with a more high-profile external search.

Chairman Paul Rayner said being a good board looking at ­succession issues it had in fact tested Ford’s credentials with its headhunters, a process that apparently was in train ahead of Friday’s formal notice from Clarke.

This said, Ford is a TWE ­insider who owns the strategy as much as Clarke, so if the direction is right then the last thing you want is some outsider thinking he or she knows best.

The timing of the departure is the biggest shock because both Clarke and Rayner, in separate meetings with shareholders, had indicated in recent weeks he would be around for the long term.

That is not happening any more.

This triggered further questioning based on an apparent ­repositioning of the growth ­forecasts.

The market is expecting this year’s earnings to increase by 19 per cent, or $126m, from $662m to $788m. The 2020 forecast is for a 21 per cent increase to $955m based on lower costs and a great vintage.

Clarke noted on Monday that as the numbers get bigger, it was harder to keep posting higher ­percentage gains, which the naysayers took as an effective profit downgrade.

We are talking 18 months off and the market is overanalysing this issue.

Clarke has expressed concerns about his aged parents in London and went into some detail on Monday about his long-distance marriage with his wife Fiona.

Maybe Fiona drew a line in the sand on the 12-month deadline and there is no doubt a constant struggle in maintaining a high-profile corporate career and a happy partnership at home.

The man is not short on ego and runs on autocracy at work that is keeping his sick parents on the wish-list for the next 12 months, so let’s keep that in context when the discussion comes to family.

This year, on paper, Clarke’s annual stipend is $11.9m, including $2.7m in turn-up-to-work pay, $4m in bonuses and $5.2m in long-term compensation.

Clarke is a change agent who, in his six years at Treasury Wine, has done an extraordinarily good job. But arguably it is now time for a change — to put an operator like Ford at the helm to reap the harvest produced by the great man.

Rayner drew his own line in the sand to say the best was still to come — he now owns that statement and will be judged ­accordingly.

Monday’s 11.8 per cent fall in the stock price, wiping $1.5bn from Treasury’s value and bringing the stock back to August levels, was obviously a reflection of the surprise at the timing of the Clarke announcement.

After all, last month, when he presented his management team to analysts, the mantra was all about stability.

This was necessary because after five CFOs in four years and a string of top-level departures, the market wanted to know the team was settled.

We didn’t want to know the top guy was walking, too.

The departure won’t happen for another year, after the 2017 bonus shares presumably vest, but still some might wonder whether Clarke thinks the easy fruit has been picked and it’s all now getting more difficult.

With the benefit of hindsight, at the time of the late September strategy day, Clarke was perhaps preparing for change because he basically handed the stage to his heir apparent, Ford.

Last week’s annual meeting came and went without any word about the departure, which was important because if any company is subject to “key man” risk it is TWE.

Clarke is pencilled to stay for another 12 months as an adviser once he formally leaves around this time next year, but the terms of that contract are still to be formulated, the company says.

He is obviously angry about criticism of his tax-driven share sales, which he stressed again on Monday had nothing to do with his commitment to the company and everything about the need to pay his tax bill.

On any score, he has done a great job and, like any change agent, he has a use-by date which he clearly thinks has arrived.

The question for shareholders now is how good is Tim Ford. And how will he manage Treasury’s all-important inventory.

Clarke will obviously want to keep the stock moving in the ­interim, which means he will keep delivering on what has been, on any reading, an outstanding performance.

But what happens next is what concerns the market.

Civil war at Cromwell

Cromwell’s Paul Weightman is a feisty character who is no dunce when it comes to the property market.

But if he had any thought that his major shareholder, ARA’s John Lim, was ready to throw in the towel then the nomination of Gary Weiss as his nominee to the Cromwell board would have put that to rest.

Weiss is an inspired choice, and unlike ARA’s previous nominee, David Blight, he is not management and in fact comes from an ­investor company in the Singapore vehicle.

He also knows Cromwell chairman Geoff Levy from way back and has an established track record of fighting for shareholder rights and delivering value.

Weightman and Levy stepped up the fight by refusing to share full board papers with Blight and then earlier this year refused to let ARA participate in a share placement that diluted its stockholding to 18.05 per cent.

Heading into the Cromwell ­annual meeting later this month the battle lines are drawn with Weiss rightly expressing the view that a major shareholder should have board representation.

Weightman is also right to be a little leery at ARA’s long-term ­objective, which is all a long way from the uplifting words last year when it entered the register with the aim of helping Cromwell expand.

Medical breakthrough

Affinity Private’s software vehicle, Medical Director, has cracked its first big offshore contact with Britain’s National Health Service ­adding its Helix software products to its $600m distribution contract list.

MD’s Matt Bardsley said the software offers cloud-backed services to GPs and specialists allowing them to upload patient data to offer full access to other doctors as required.

Bardsley jokes that the software is an overnight success as it has been around for a couple of decades but the British move is a big chance to get some of $600m on offer and expand to other ­markets.

The software is used by over half of GPs in Australia and the company was sold by Primary Health to Affinity three years ago.