Toll unveils new image at AGM

Toll uses AGM to rebrand, as Paul Little outlines his views on his replacement and the economy

Toll unveils new image at AGM
Toll unveils new image at AGM
By Rob McKay | October 29, 2010

The announcement of Managing Director Paul Little’s departure in 15 months’ time has coincided with a rebranding and new approach to women.

Toll Chairman Ray Horsburgh confirmed today the outline of Little’s departure in January 2012 and informed the company’s annual general meeting in Melbourne that past corporate governance and board independence concerns have been addressed.

Horsburgh says the board had been planning the succession "for some time now".

Little’s departure means he will not receive $2.25 million in share options, as that would be "poor form" given its strengthened corporate governance, Horsburgh says.

The issue of gender representation was also the subject of a question from the floor.

"We expect a new female board member by the end of this financial year," Horsburgh says.

In his speech, Little announced a strengthening of the brand.

"Some of our acquisitions have changed their names to reflect Toll ownership," Little says.

"Others have in the past retained their identities, especially those that were well known in the marketplace: Ipec, in2store and NQX are examples. As a result, Toll’s current brand portfolio is extensive.

"To address brand complexity, we plan to progress to a single Toll brand across the group."

Toll’s shade of green will stay but the logo will be plain white.

In answering a question from the floor on worker remuneration, Little pointed out that the TWU award was in place and a new enterprise agreement should be agreed before Christmas.

"Toll is above the award almost on every occasion because we need to attract the best people," Little says. He used it as a pointer to Toll’s thrust of executive remuneration, an issue that has met with shareholder anger in the past.

Meanwhile, a constitution was withdrawn as an item due to shareholder concern. It will be restructured and returned at next year’s AGM.

In a press conference afterwards, Little said that if the present 20 percent international revenue rose to 30 to 40 percent revenue over five years he expected the present 20 percent foreign ownership would rise a similar amount.

In a swipe at his local critics, Little says international investors are "more savvy when it comes to a global transport business, which is what we are building at the moment".

He says international fund managers last calendar year had marvelled at the low revenue shrinkage – 6 percent – compared with experience elsewhere in the world.

Little envisaged having some involvement in the process of choosing his replacement but what that would be appeared undecided.

Given Toll’s growing international business and global ambitions, international experience will be increasingly important, Little says, but he emphasises the executive search will also focus on people within the company.

"What makes Toll a more difficult role to fill is that Toll is involved in supplying logistics services all the way up and down the supply chain - from aircraft to ships to couriers to warehouses to long-distance transport, wharf cartage, whatever it is," Little says.

This "multiplicity" of operations means the best candidate will either be internal or the leader of a global forwarding or express firm.

There will be a six-month search starting around Christmas followed by a "integration" process that will take about the same amount of time.

Asked about the gender issue, Little responded: "The best man or woman for the job will be the best person."

On predictions of a double-dip downturn, Little is "very much out of that camp", due to better conditions in countries that had borne the early brunt of the global financial crisis.

"I’m very optimistic on what we are seeing in Asia and what we are seeing in the US and, in the Toll model, we will get very strong growth in those two areas," Little says.

He noted that though domestic retailers’ margins and profits were down as they tried to attract more consumers, this was not translating into more volumes.

In his presentation, he says that "we don’t anticipate above-forecast trading from key market sectors within Australia in the lead-up to Christmas.

He adds: "Conditions in Australia excluding resources remain flat, with our major retail customers . . . experiencing a slightly slower than anticipated pre-Christmas build-up.

"Retailers, however, expect improvement in the second half."

Little says resources continue to be a standout performer for Australia, with strong growth boosting Toll’s domestic and international opportunities.

He says ongoing investment in fleet, technology and mergers and acquisitions will deliver strong results for Toll.

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