John Wylie’s short memory on Lendlease predictions; Tony Lombardo’s poorly-timed interview

Tanarra Capital founder John Wylie. Picture: David Caird

It’s been fun watching Tanarra Capital’s founder and serial-hater John Wylie bag the crap out of Lendlease in yet another memo – this time to the board – branding its international construction business an unmitigated disaster.

Well, it’s more of the same from John. In February he was bollocking on about the construction giant’s “broken business model”, saying it “clearly needs restructuring”. That was after the release of the company’s uninspiring half-year ­results.

No one would deny the business is on a downswing, but all this kicking of Lendlease from Wylie is a bit hypocritical. As we’ve previously pointed out, he was one of the company’s most vigorous backers two years ago and practically giddy with suggestions that “exiting exposures to Australian markets” would help the share price skyrocket.

Hilariously, he’s running a mile from all that and saying the exact opposite now. “The right foundation of competitive advantage lies in Australia,” says his recent letter to the board. Bloke’s honestly got more hide than a Sumatran rhino.

As he told Tanarra investors in April 2022, a year after Lombardo’s appointment as chief executive: “We regard Lendlease as a fundamentally high-quality global company with real competitive advantages.” He then backed its strategic direction, slapped a buy rating on Lendlease – trading at $11.10 per share – and predicted an SP of $20 during FY24, even $25.20 with targets met. The share price now? $6.40, lower than Wylie’s bear case prediction of $8.40.

No mea culpa from him, either. Why bother?

It’s so much easier to shovel dirt at management.

It’s all in the timing

And speaking of management, we can’t help but face-palm at the bizarre timing of an interview and podcast published with Lendlease CEO Tony Lombardo in the Fin Review on Tuesday. No great surprises or curveballs in what he says, of course, but it’s just more of the usual guff that off-duty CEOs tend to hold forth about.

Much waxing about working like a dog since the age of 15 (“the longest break I’ve ever had is only five weeks”), plus his love for the Foo Fighters, karaoke, and the regulation yearning for more quality time with the fam-bam, all of this going on record at a time when investment banks are circling to break up his company and the share price is lumbering in the low dollars.

Lendlease chief executive Tony Lombardo. Picture: John Feder

A seemingly odd admission, too, that he’s in the office around 8am and wrapping up between 5pm and 6pm, with perhaps a meeting or two thereafter, making the role of CEO sound pretty ho-hum and like one long stretch on a beach towel.

The last question – what would he do with 12 months off? – provided another window into the Lombardo soul, his answer predictable enough: “I’d probably spend six months travelling around Australia, and six months travelling around Italy.”

And who knows? Perhaps the opportunity might arrive sooner than he thinks.

Audit angst

An embarrassing announcement from litigation funder Omni Bridgeway on Tuesday reporting the discovery of an internal kertwang going back to mid-2021.

That was when the company announced BDO as its auditor, except the appointment was never ratified by shareholders at the company AGM later that year. Why? In the words of OB there was an “inadvertent omission” relating to BDO, and it’s led to a great big toothache for the business that now requires immediate extraction.

“This is a procedural matter and the quality and the substance of BDO’s audit work is not in any way in question,” company officials told the market.

But sheesh, what a mess. Now it’s had to go begging to the Supreme Court of Western Australia for orders declaring BDO’s appointment totally valid and kosher and not in any way a gross contravention of Chapter 2M of the Corporations Act – a section that dwells on the appointment and removal of auditors, and which is long, like tranquilisingly long, and rivalled by topics like fluvial processes in geomorphology for its staggering dullness.

Think of all the backstopping the company now has to manage on account of this snafu, like the revalidation of all the cleansing notices that were released in the years after the pseudo-appointment of BDO. Omni’s currently in a trading halt because of this announcement, pending the court orders it seeks.

The irony of it all, too: a company supposedly up to scratch in its management of payments can’t keep their own damn house in order.

Airport encounters

Spotted at Sydney Airport on Tuesday: Australian tennis’s enfant terrible Nick Kyrgios, apparently heading back to Canberra for a retooling of his professional career. Or so he told a podcast interview broadcast several days ago.

“I’ll be back on court soon and I’ll give you a little bit more to cheer about, that’s for sure,” the former world No.13 said in a message to fans, insisting there was still “fire in the belly”. Although it’s harder to know what Kyrgios discussed with Spiro Premetis, the outgoing executive director of the Financial Services Council, who happened to bump into the former world junior No.1 in the terminal.

Nick Kyrgios, left, poses for a selfie with Spiro Premetis.

Most of their conversation was in Greek, we hear, although Premetis said Kyrgios was a gentleman about the interruption and even agreed to pose for a selfie. Check it out: looks like the former champ was challenging Kanye West for least-smiling-and-even-most-dour-photo-of-the-year.

Seen fast-walking nearby was former treasurer Peter Costello en route to his gate. Auspicious to spot him so close by, too, given the ex-chair of the Future Fund will appear at an FSC breakfast on May 22 with Tim Wilson, the newly-crowned Liberal candidate for the seat of Goldstein.

The plan is for Wilson to IV Costello on stage at the Melbourne Intercontinental in the week after the federal budget is handed down. Tickets are selling for $90 a pop, or $700 for a table.

 

Military manoeuvre

It was only last month that we reported former Japanese ambassador and Liberal Party ally Shingo Yamagami had come back in from the cold after his freezing out by the Albanese government. He’s joined the advisory board of Hemisphere East, a strategy firm started by former Australian Federal Police officer Cameron Watts and Paul Maley, a former national security correspondent with this masthead.

Retired Chief of Defence Force Peter Leahy. Picture: Soldier On

But the ranks are growing, we hear, with retired lieutenant general and former chief of army Peter Leahy about to join the firm’s board in a similar advisory capacity, bolstering its military expertise and focal areas of the AUKUS partnership – or should that be JAUKUS, now? – and the Indo-Pacific. Leahy’s been in the news in recent months breaking all manner of alarms about Australian Defence capabilities, namely our lack of drones and a slashing of tanks. “We know from history and recent experience – tanks save lives,” he said in November.

Confirming the appointment to Margin Call, Leahy said he was pleased to be joining the firm at “such a strategically important time” for national security. “More than ever we need to understand and support emerging technology and defence capability,” he said.