The former Sydney Airport chief executive Russell "Balding" Balding has finally been recognised for his skills in imposing additional service fees on taxi passengers and drivers.
Balding was given a warm reception yesterday when he joined the board of taxi fare payment company Cabcharge.
"We are very fortunate that Russell will be joining Cabcharge as a member of our board," said Cabcharge's clearly delighted executive chairman, Reg Kermode, in a statement.
The 84-year-old Kermode highlighted Balding's "invaluable business experience across many complex transport and communication operations".
During his five years at Sydney Airport, Balding lifted the "ground transport access fee" for taxi passengers from $2 to $3.
It was again lifted to $3.50 last week, just after Balding's departure.
The fee, which is supposedly meant to go towards upgrading taxi facilities at the airport, raises an estimated $10 million of revenue a year. Sydney Airport recently trumpeted its $2.8 million upgrade to the taxi rank at Terminal 1. The fee is on top of the 10 per cent service fee charged to passengers who use the Cabcharge payment system. Like Kermode, Balding is also well experienced in dealing with the competition watchdog.
Balding will help fill the void left by last year's departure of the former NSW Premier Neville "Don't Cry" Wran from the Cabcharge board.
FEARS FOR CHEERS
CSR's retiring chairman, Ian Blackburne, might struggle to get a standing ovation when he is farewelled at the company's annual meeting today.
After copping a blast at a general meeting in February where shareholders approved a capital return of $661.4 million from the proceeds of the $1.75 billion sale of CSR's sugar business, the Sydney-headquartered company is still expected to face a hostile crowd, despite holding its first annual meeting in Melbourne.
Discussions between the Australian Shareholders' Association and CSR's incoming chairman Jeremy Sutcliffe on Tuesday night appear to have failed to take any heat out of today's meeting.
The ASA fired off a statement yesterday highlighting Blackburne's achievements during his eight years as the chairman of the building products company.
"It was Dr Blackburne and former CEO, Mr Jerry Maycock who orchestrated the purchase of the Viridian (formerly Pilkington & DMS) glass businesses in 2007 for which CSR paid $865 million. Those predominantly debt-funded purchases have since had to be written down by $651 million, including $121 million this year," said the statement.
The salvo from the ASA's Stephen Matthews added: "The current management of CSR has now been left with a glass albatross that will continue to haunt them, and restrict the company's ability to make returns to shareholders for years to come."
A CSR spokesman argued its shifting of its annual meeting to Melbourne was in acknowledgement of the company's Victorian shareholder base "being slightly less than New South Wales" and its large manufacturing presence in the state. He said the company now "felt it was appropriate to move the AGMs around".
STEP ON THE GAS
One of the ASX's more diversified companies has decided to stay that way. The mobile advertising, petrol station, cable television, eyewear lens distributor and Czech oil explorer Carpathian Resources yesterday ditched plans to sell its leases on two petrol stations in Florida.
Carpathian in a statement explained the $US300,000 ($280,000) it expected from the sale "was inadequate and merely an effort to generate cash, notwithstanding such sales would have been at a significant loss".
The explorer, whose executive chairman Maximiliaan Danishevski was recently reinstalled (after being ousted at a shareholder meeting in 2008), bought the two petrol station leaseholds for $US890,000 in 2009.
" ... The company believes with ... proper management [that] operating margins can be increased, increasing the overall value of the investments, with a view towards resale of the stores at a profit," Carpathian said in its 2009 annual report.
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Frequently Asked Questions about this Article…
Who is Russell Balding and why did Cabcharge appoint him to the board?
Russell Balding is the former Sydney Airport chief executive. Cabcharge welcomed him onto its board because of his transport and communications experience, including his record of imposing additional service fees on taxi passengers and drivers and his experience dealing with the competition watchdog, according to Cabcharge executive chairman Reg Kermode.
What is the Sydney Airport ground transport access fee and how has it changed recently?
The ground transport access fee is a charge added to taxi fares at Sydney Airport intended to fund taxi facility upgrades. During Balding’s five years at the airport it rose from $2 to $3, and the fee was lifted again to $3.50 shortly after his departure.
How much revenue does the ground transport access fee generate for Sydney Airport?
The article says the ground transport access fee raises an estimated $10 million of revenue a year for Sydney Airport.
How does the Cabcharge payment system affect taxi passengers’ fees?
Passengers who use the Cabcharge payment system pay an additional 10 per cent service fee on top of fares, according to the article.
Why was CSR expected to face a hostile crowd at its annual meeting?
CSR was expected to face criticism after shareholders approved a $661.4 million capital return from the $1.75 billion sale of its sugar business, and because the Australian Shareholders’ Association highlighted large write-downs tied to the 2007 purchase of the Viridian glass businesses (CSR paid $865 million and has since written down $651 million, including $121 million this year).
What did the Australian Shareholders’ Association say about CSR’s Viridian acquisition?
The ASA noted that CSR’s 2007 purchases of the Viridian (formerly Pilkington & DMS) glass businesses cost $865 million and were predominantly debt-funded, and that those assets have since required $651 million in write-downs, including $121 million this year, which the ASA said will restrict CSR’s ability to deliver returns to shareholders.
Why did Carpathian Resources decide not to sell its Florida petrol station leases?
Carpathian Resources said an expected US$300,000 (A$280,000) sale price was inadequate and would have resulted in a significant loss; the company bought the leaseholds for US$890,000 in 2009 and believes with proper management it can increase operating margins and ultimately resell the stores at a profit.
What should everyday investors watch for from these company developments?
Based on the article, investors should watch board appointments and leadership changes (like Balding joining Cabcharge), fee changes and revenue sources (Sydney Airport’s access fee and Cabcharge’s 10% charge), asset sales or retention decisions (Carpathian’s petrol station leases), and shareholder activism or write-downs (CSR’s Viridian acquisition and ASA criticism), as these can affect company revenue, costs and investor returns.
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