CSL ‘never going to be a dividend stock’ says chairman amid pay outcry
CSL chairman Brian McNamee has made a spirited defence of the growth prospects of Australia’s premier biotech, after the company suffered a 23 per cent protest vote over executive pay at its annual meeting on Wednesday.
The $123 billion blood products giant has suffered close to a 25 per cent fall in its share valuation since a high of $336 in February 2020. New CEO Paul McKenzie succeeded Paul Perreault in March.
Dr Brian McNamee says he can’t control the share price. Eddie Jim
The Australian Financial Review understands AustralianSuper was among investors to vote against the remuneration report, after Ownership Matters and the Australian Council of Super Investors took issue with CSL removing the impact of the $US11.7 billion ($18.2 billion) acquisition of Swiss business Vifor from the bonus targets.
Mr McKenzie’s reported pay this year was $US4.4 million. The company said that was significantly lower than Mr Perreault, but 24.95 per cent of votes cast also took issue with performance grants worth as much as $US7.7 million to Mr McKenzie.
During a fiery exchange with a shareholder on Wednesday, Dr McNamee maintained that the company is still a healthy growth stock.
“None of us like the share price dropping,” Dr McNamee said. “You have every reason to be grumpy.”
“We remain a growth company … we cannot control the share price,” he said.
Dr McNamee said that interest rates had “grown much faster internationally than any of us have anticipated, and that affects cost of capital and it really affects your terminal value”.
“The healthcare sector globally has had a contraction in valuation. We’re in good company. I can’t fix the macroeconomic challenges, all we can do is run a good business,” he said.
Dr McNamee also said that CSL is “never going to be a dividend stock”.
“If you want to clip the ticket and be a dividend investor I can tell you there may be better investments for you. Our intention is to be and remain a growth company, and we believe, over time, that growth will be rewarded in the growth of the share price.”
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