In total he earned $2,322,503 FY24 - down from $3,703,797 in FY23.
That was a big fall from the $6,589,027 he earned in FY22 when Taylor got a bumper short-term incentive bonus of $3,338,614 from targets met in previous years.
But what Taylor received in FY24 was higher than the $2.32m due to prior year performance bonuses being paid out.
Fletcher Building’s annual report shows one person received between $4.38 million and $4.39m in the FY24 financial year. A Fletcher Building spokeswoman confirmed that person was Taylor.
“This includes his fixed remuneration and incentive payments, which relate to performance in prior years but paid to him in FY24.”
In FY23 Taylor received between $6.67m and $6.68m.
Traber, who stepped into the position on March 29, received $365,825 for the period until the end of the financial year on June 30.
He could have earned a short-term incentive for the period but the board applied its discretion to forfeit the bonus.
The annual report shows that based on a scorecard of measures he only achieved 18% out of a possible 150% score. Traber did not earn a long-term incentive for his role as acting chief executive.
Fletcher announced this week that Traber was returning to Switzerland and it had appointed Andrew Reding as its new chief executive and also named him in a newly created position as its managing director.
In FY24 Fletcher had 5231 workers who earned over $100,000, of which 3145 were New Zealand-based, up from 4787 in FY23 (2877 NZ-based).
Questions over Synlait deals
Why did a2 Milk agree to pay Synlait $24 million as part of an agreement to resolve various supply contract disputes?
Stock Takes posed the question to a2 Milk’s chief executive and managing director David Bortolussi after the company’s result this week.
”It was in no way a break-fee or penalty,” Bortolussi said. ”It represents certain payments to Synlait for pricing of product and project support which were in dispute over 2024.
”Under the terms of our manufacturing supply, when a matter is under dispute the relevant parties are entitled to withhold that payment.
”Payments that were withheld in full year 2024 will be paid shortly, but some of it is contingent on the capital raise,” he said.
Synlait aims to raise $217.8m from its two biggest shareholders, a2 Milk and Bright Dairy.
The deal is seen as controversial because Synlait’s minority shareholders have not been accommodated in the equity raise, meaning their holdings will be heavily diluted.
As one market watcher told Stock Takes: “It’s like the board turned around and said, ‘thanks for your loyal support but we took financial advice and we don’t need you anymore’.”
The issue has caught the attention of the New Zealand Shareholders Association whose chief executive Oliver Mander described the scene as disappointing. The shareholder vote will likely pass but not without fireworks.
Synlait has gone on the front foot, in terms of highlighting the share price premium that Bright is paying (as opposed to a deeply discounted rights issue) and the fact that minority holders would be on the hook for at least four times their current holdings under a more equitable cap raising plan.
A2 falls short
The market was underwhelmed by a2 Milk’s result, based on its earnings outlook. In essence, the outlook boiled down to more of the same in 2025.
Forsyth Barr analyst Matt Montgomerie said there were concerns, based on comments made on the conference to analysts, about supply constraints.
”The canary in the coal mine, where investors may feel uneasy following the 2024 result, is a2 Milk calling out supply issues from its key supplier Synlait Milk,” he said in a research note.
”Full year 2025 ebitda is set to be adversely impacted by at least $15m as a result, but more importantly it raises questions: (1) that similar issues could occur in the future, and (2) if it will impact new customer acquisition [the timing of which is particularly unfortunate, given 2024 births growth],” he said.
”At this stage we trust that the issues will be isolated to first half 2025.”
Chart of the week: My Food Bag
At last, some good news for My Food Bag shareholders.
The meal kit company has seen its share price double in value over the past week with the stock closing at 26 cents midweek, up from a low of 13c.
But while the recent price action will be welcomed by investors, there is a long way to go before the share gets anywhere near the 2021 listing price of $1.85.
The market appeared to appreciate an update from chairman Tony Carter at last week’s annual shareholders meeting when he talked about a stabilising customer base and expectations of paying dividends in the 2025 financial year.
Carter also pointed to evidence that the company was gaining on its major competitor, Hello Fresh. Analysts have attributed the market gain to product diversification, with the low-cost Bargain Box appealing to consumers in the current economic environment.
My Food Bag has plenty of work to do and it was clear from shareholder questions at the annual meeting that many are feeling bruised from what was a disastrous IPO in 2021.
However, it is good to see customer demand stabilising.
Waterworks over Infratil story
It’s rare for executives to be brought to tears, but Madison Reidy’s deep dive into Infratil’s investment history did it for friends of the company’s founder, the late Lloyd Morrison.
Mark Cairns, who worked with Morrison when Infratil owned the Port of Tauranga, said Monday’s Markets with Madison episode got his waterworks going.
“Lloyd was on the board of Port of Tauranga when I was interviewed to be CEO,” Cairns recalled.
“He was a miserable s**t in the interview.
“[He] punched me [hard] on the arm afterwards and said he was being provocative and wanted to see how good at arguing I was.
“Lloyd was a special man.”
More was said about Morrison’s wine collection.
“Lloyd’s cellar was unbelievable,” Cairns said.
“He had a dinner at [redacted Wellington restaurant] when he retired off the board of [Port of Tauranga] and he brought along the most expensive Bordeaux to the restaurant.
“I busted the sommelier taking a full glass for himself out of each bottle.”
Although Lloyd’s brother Rob concluded his wine collection was superior.
The company celebrated 30 years in business at a gala dinner at the Te Papa Museum last night.
Watch the episode about Infratil’s untold investment history below.
What’s good for Walmart is often bad for rivals
Walmart is often seen as a bellwether for the United States retail sector and consumer behaviour. Little wonder: the company, which generated $648 billion in revenue last year, is the country’s biggest bricks-and-mortar retailer by sales.
Walmart’s strong second-quarter results and bumped-up full-year guidance last week suggest good times ahead for the company. But it is not necessarily the best proxy for the wider retail sector.
What is good for Walmart is often bad for rivals. Investors who bid up shares of other retailers such as Target, Macy’s, and Gap on the back of Walmart’s earnings may be setting themselves up for disappointment as more retailers prepare to report their results.
Walmart’s size and business mix make it unique among US retailers. For starters, it has a huge US grocery business, which generated 60% of the revenue at Walmart US last year. Being a purveyor of cheap groceries has proved to be a sweet spot in the current climate.
While the rate of inflation in the US has eased, day-to-day life in America continues to be much more expensive than pre-pandemic. Food prices, for example, went up 25% between 2019 and 2023, according to government data. They rose faster than housing, medical care and all other major categories apart from transportation during this period.
This means even as US households are cutting back on everything from Big Macs and caramel frappuccinos to trips to Disneyland, bargain hunters are still packing the aisles of Walmart. More middle- and higher-income shoppers are doing their grocery runs there. At the same time, lower-income consumers are snapping up more of the company’s private-label food offerings.
Like-for-like sales at Walmart US climbed 4.2% year-on-year during the second quarter. At Home Depot, the only other major US retailer to report results so far, they fell 3.6%. The DIY retailer expects the metric to fall between 3% and 4% for the year. Walmart raised its forecasts for full-year sales and adjusted operating income.
Selling groceries is a low-margin business. Walmart is able to keep prices low on food because of all the other side businesses it runs. Third-party online marketplace, digital advertising and Amazon Prime-like membership schemes — all these are fast-growing and more profitable. Few other bricks-and-mortar retailers can claim to be able to do the same.
Walmart’s share price performance reflects this. The stock is up nearly 40% this year and hit a new record high on Monday. At 29 times forward earnings, Walmart is also trading at a hefty premium to the broader retail sector. Do not expect the gap to close soon. - Lex
- Additional reporting Duncan Bridgeman, Jamie Gray, Madison Reidy and the Financial Times
