Bellamy’s trouble unravels
The result of the election left only three directors and no chairman. Former Virgin Australia director David Baxby was touted as a possible appointment for the chairman position.
Bellamy’s also said it may have to seek new registration for its infant formula products with the China Food and Drug Administration. The Chinese government announced that a CFDA registration will be required for overseas-produced infant formula products sold in China, starting in January 1, 2018.
Shares in Bellamy’s lifted after coming out of a trading halt in the wake of the shareholder meeting and closed 18 cents, or 4.2 per cent higher at $4.45.
Kathmandu founder Jan Cameron failed to win a seat at the board of the troubled infant formula supplier Bellamy’s, after the elections yesterday. Reporters asked Cameron if this news disappointed her but she said that those elected can do a better job.
“No, because I think the incoming directors will actually be better than me, and the appointments they will make in the future will be more suited to the company’s requirements,” Cameron said.
According to her, the former Bellamy’s board didn’t successfully created good decisions for the business. Cameron said the new directors should get a plan immediately to turn the company around within a month.
She also told shareholders that a turnaround of Bellamy’s would be very complex, adding that the problems with the China distribution and the pricing of the products of the troubled infant formula maker will be complicated. Shares Bellamy’s were placed in a trading halt ahead of the meeting.
“We don’t have all the information at the moment,” Cameron said. “I’ve just spent a couple of weeks up in China and there are indeed a lot of problems with distribution and pricing in China, and that’s where we would first tackle the problem.”
Meanwhile, Black Prince nominees Rodd Peters and Chan Wai-Chan were voted to join Bellamy’s board of directors. Black Prince, whose sole purpose is to invest money to support charity work, funds the Elsie Cameron Foundation, wherein Cameron is a trustee.
Several members of the board were also ousted from their seats. Directors Michael Wadley and Charles Sitch were dumped. It was only director Patricia Mann who survived.
Wadley had 32.57 million proxies who approved of him onboard while 20.34 million were against. He became the acting chairman after the longstanding Bellamy’s director Rob Woolley resigned prior to the extraordinary general meeting.
He told the shareholders, given the status of votes at the close of the receipt of proxies on Sunday, the company’s board didn’t expect to hold their positions after the shareholders voted yesterday.
Sitch, on the other hand, got 32.72 million proxies voted for his removal and 20.21 million for those against the former director.
Bellamy’s major events was also preceded by the resignation of former chairman Woolley and former director Launa Inman.
Morgans analyst Belinda Moore sees the situation of Bellamy’s as a long journey but she said there were positive signs basing on the 18-month recovery plan, which was outlined by the acting chief executive Andrew Cohen on February 24. Bellamy’s unveiled a 47 per cent fall in half-year profit to $7.2 million.
“Everyone needs to get on with business and turn around this business because it is a very strong underlying brand,” Moore said. “They just need to get through some short-term challenges.”
The Tasmania-based company has endured a massive plunge in share price and faces a shareholder class action after it flagged a significant drop in sales in China and twice downgraded its full-year earnings forecast.