It was a year overshadowed by Greeks with cash flow problems, Americans with rising debt ceilings and markets in turmoil. But it also was a year of achievement, writes Scott Rochfort.
Most humble comment of the year
Rupert Murdoch. "This is the most humble day of my life," the News Corporation executive chairman told a British parliamentary inquiry into his company's involvement in a phone hacking scandal.
Slap-down of the year
Wendi Murdoch. Rupert Murdoch's wife showed she had far quicker reflexes than anyone else including the police who attended the same British parliamentary inquiry into the phone hacking scandal.
"Mr Murdoch, your wife has a very good left hook," the Labour MP Tom Watson said, after Mrs Murdoch slapped down an intruder who attacked her husband with a shaving foam pie.
Best remuneration package for a company valued below $100 million
Jeremy Philips. The incredibly shrinking marketing company Photon Group did not let its $59.7 million full-year loss inhibit its ability to pay its chief executive $3.97 million in total remuneration for the year to June 30. Not bad for a chief executive of a company not big enough to get inside the ASX 300.
Most understated $3.3 billion record half-year cash net profit
Commonwealth Bank. "Yes, we are a profitable organisation but not excessively so," the bank's former chief executive, Ralph Norris, said in February. The bank went on to report a $6.8 billion full-year cash net profit.
Most sensitive announcement of the year
BlueScope Steel. The steel maker announced plans to lay off 1000 workers in Australia the same day it reported a $1.05 billion loss and disclosed its senior executives including managing director Paul O'Malley were paid $3 million in cash bonuses.
Non-float of the year
Nine Entertainment. It was meant to be the blockbuster listing of the year, but it turned out to be a turkey. The advisers of the CVC Asia Pacific-owned television and magazine company went from putting out feelers on a hypothetical $5 billion listing to entering frantic negotiations on the group's mountain of debt.
Makeover of the year
Nathan Tinkler. The billionaire electrician and coal baron shed his goatee and around 40 kilograms as part of his moves to streamline his operations. Following a management reshuffle at his part-owned Aston Resources, Tinkler's media minders were also keen to circulate a more corporate-looking Tinkler wearing a suit and tie.
Most timely share sale of the year
Alan Robertson. The chief executive of the biotech Pharmaxis sold half of his shareholding in the biotech just days before shares in the company plunged 74 per cent in one day.
Just after Robertson disclosed he had offloaded 500,000 shares for $1.48 million, Pharmaxis announced that it received a "negative trend vote" over its application for its cystic fibrosis treatment in the European Union. "Although this is not the final stage in the application process, we are clearly disappointed with the outcome of this trend vote," Robertson said in a statement.
Most logical argument for the non-disclosure of executive pay packets
Graham Bradley. The former president of the Business Council of Australia (aka CEOs Union) warned that the disclosure of executive salaries in annual reports was pushing up wages. "The inflation of executive salaries has got to do with the fact that everybody has got that information. That reduces the leverage of boards," explained Bradley. "I think it has caused inflation," said Bradley, who has seen his own fees as the chairman of Stockland jump from $325,000 to $500,000 since late 2005.
Most unconvincing "grassroots" campaign
Cash Converters. The ASX-listed pawn shop chain declared the "grassroots action has only just begun" when it issued a press release in September complaining about the federal government's plans to cap fees charged on pay-day loans.
"We know this misguided legislation has hit a raw nerve with all consumers who deal with regulated and reputable lenders around Australia," said Cash Converters' managing director, Peter Cumins, as the company launched the website nocap.com.au.
Most unorthodox use of an Australian punk song
Guy Debelle. The Reserve Bank of Australia head guitarist and assistant governor urged investors to check out the lyrics of a song by the Saints.
"Investors need to heed the seminal words of the Saints' Know Your Product and do the necessary due diligence," Debelle told the Australian Securitisation Forum at the Sydney Hilton in November.
The lyrics to the song include: "Cheap advertising, you're lying. Never gonna get me what I want. I said, smooth talking, brainwashing. Ain't never gonna get me what I need."
Best typo by a mining explorer
Ampella Mining. The mining explorer issued an update to the market in February where it failed to remove one sentence from the editing process. Next to the section of the update where it discussed a four-kilometre gold anomaly was the comment in brackets: "Can you please fix this up to make it sound technical."
Best use of a word count
OM Holdings. The manganese miner rebuffed a requisition of meeting seeking to install former NSW Liberal leader Peter Debnam and the investment banker Malcolm McComas as directors on technical grounds. The Bermuda-domiciled OM said the requisition of meeting lodged by the Ukrainian billionaire Gennady Bogolyubov's Consolidated Minerals was "technically not compliant" with Bermudan law.
It claimed the notice of meeting broke Section 79-1b of the Bermudan Companies Act, which states that notices of meeting cannot be "more than 1000 words with respect to the matter referred to in any proposed resolution or the business to be dealt with at that meeting".
Most impressive use of benchmarking
Pacific Brands. Pacific Brands chairman James MacKenzie explained why the salary of his chief executive, Sue Morphet, was benchmarked against two companies (Myer and David Jones) that each had market capitalisations three times the size of the struggling underpants and singlet company.
"It is acknowledged that the current market capitalisations of some of those companies are higher than Pacific Brands, but your board's view is that they represent the most comparable organisations and the ones against which Pacific Brands would have to [and does] compete for talent," he explained.
Morphet received $2.75 million in remuneration last financial year.
Most underwhelming sharemarket debut of the year
Altius Mining. The gold explorer's first day as a public company was one chief executive Alexander King would like to forget. Its shares went from 20? to 8.8? on their first day of trading.
Most defiant comments made to an annual meeting
Reg Kermode. The 85-year-old Cabcharge executive chairman said at the company's annual meeting he had no plans for retirement when a strong vote was recorded against the remuneration report.
"I know everybody wants me to die," Kermode told the meeting. "I have no intention to die at the present time some of you can keep on wishing."
Most self-complimentary send-off
Tony D'Aloisio. The former Australian Securities and Investments Commission chairman crowed in the year of his departure about how recent corporate collapses were only slightly more damaging than the collapses after the 1987 sharemarket crash. "These totalled [about] $66 billion [between 2007 and mid-2009], representing a slightly greater proportion of GDP than the $20 billion lost in the major collapses during the turmoil of the late 1980s," he said.
Non-comeback of the year
Phil Sullivan. The former chief executive of the collapsed Gold Coast financial concern City Pacific re-emerged from a three-year hibernation to offer "unpaid assistance" to an unnamed group of investors seeking to topple the managers who toppled City Pacific as the managers of Sullivan's former flagship mortgage fund in 2009. Sullivan marked his return by explaining he was not responsible for the collapse of his old firm or the problems related to the still frozen First Mortgage Fund. "Only when the world's finances and banking system hit the wall with the onset of the banking credit squeeze and the global financial crisis did City Pacific see rough water, along with every other mortgage and property-based fund worldwide," he said. Sullivan later said he was not involved in a proposal to install the Taree firm Stacks as managers of the fund. By November, Stacks dropped its bid and Sullivan was not to be seen.
Most holy acquisition
The Rupert Murdoch-led media organisation bought the Nashville-based Bible publisher Thomas Nelson for an estimated $200 million. "We want our products to be a means by which God breathes new life into His world," notes the publisher on its website.
Most spirited attack on a big bank
John Trimble. The chief executive and chairman of the Australia's only listed exotic dancing company, Planet Platinum, pulled no punches when describing his relationship with NAB. "They are just disgusting," said Trimble. "You wouldn't believe the charges they hit us with. I could have gone to a loan shark and got 25 per cent."
The Showgirls Bar 20 owner officially launched a national search for a "bank with an entrepreneurial attitude that conforms with commercial reality and negotiations, enabling our enterprises to operate in a normal business-like manner".
Best country song about an Australian airline
Tiger Airways and Their We Don't Care-ways. The Singapore Airlines-backed budget airline inspired the Texas-based country musician Dale Watson to write a new song about its customer service standards. Watson was charged $500 excess baggage for a crate of CDs that Tiger ended up losing. The song came out just in time for Tiger's mid-year grounding by the aviation safety regulator.
Best PowerPoint presentation
Arun Jagatramka. Gujarat NRE Coking Coal chairman picked up the award for a second year running, thanks to a presentation he gave at the open day of his Russell Vale operations in October.
Jagatramka covered "the story of five extraordinary women and the wars that paid tribute to their love". One of the women was Eva Braun (aka Mrs Adolf Hitler). "Married in a bunker, she died by taking cyanide, but kept her love alive . . . for a man the world hates."
Jagatramka's presentation also warned of the potential consequences if society was forced off coal.
"Global climate change is a truth that we all must face, but we need to ensure that facts and figures are not used to forcefully slaughter the human civilisation in a fashion similar to the Y2K scare at the beginning of this millennium, which turned out to be one of the biggest hoax calls in the modern era," it said.
Most straightforward profit update
Nick Moore. "Subject to market conditions continuing to return to more normal levels, as well as other factors including the timing of completion on transactions and normal year-end procedures, we currently anticipate the second-half result to be approximately 35 per cent up on the subdued first half and the second-half result to be approximately 5 per cent down on the previous corresponding period," the Macquarie chief executive said in February.
Most excuse-laden profit downgrade
RedHill Education. The newly listed English school operator's shares crashed in February when it blamed several factors for the slashing of its prospectus forecasts.
They included the "deepening impact of restrictive federal government international student policy changes", the "increasingly negative reputation of Australia" and the "continued and sustained increase in the Australian dollar". It also noted: "The government had been expected to address the adverse impact of its policies on the international student sector but this has not occurred."
Recipient of the biggest attack from the banana industry
Saul Eslake. The Grattan Institute economist felt the wrath of the banana industry after suggesting the rise in fruit and vegetable prices early in the year would go to growers unaffected by the floods and cyclones.
"His comments prove that he has a clear lack of knowledge of the banana industry and the devastating effects that imports would have on our industry," said Australian Banana Growers Council chairman Patrick Leahy in a statement titled "Economist's attack on bananas unwarranted and ill-informed".
Best attempt to avoid an Irish accent being mistranslated
Alan Joyce. The Qantas chief in February added the word Fokker to his blacklist of words (which already includes "third") when he discussed the airline's purchase of 10 F100 (aka Fokker 100) aircraft.
Most savvy attempt to stay in job
Nick Collishaw. The Mirvac chief executive headed off calls for him to be replaced after agreeing to cut his base pay from a hefty $2 million to a still reasonably hefty $1.5 million. "In response to concerns about executive remuneration in our sector and particularly around the Mirvac Group and the alignment of employee interests with security-holder returns, I initiated discussions with the Mirvac board around amending the employment contract that I entered into in August 2008," said Collishaw when he unveiled a first-half loss of $12.7 million in February.
Best new term
Platypus Moment. The Reserve Bank's head of financial stability, Luci Ellis, said the term concocted by Nassim Nicholas Taleb to describe unforeseen and freakish events Black Swan was not the best phrase on which to test financial stability.
"You can't imagine scenarios that are by definition unimaginable," she said.
Ellis picked a far more freakish (to European eyes) Australian creature to describe her new phrase. She said it was behaviour that appeared "too ridiculous to be true, and yet it is true" that policymakers needed to be on the lookout for. "When you have that feeling, you are having what I have come to describe as a Platypus Moment."
Catfight of the year
Paul Zahra and Mark McInnes. The former David Jones chief executive and his replacement engaged in a war of words over who was to blame for the retailer's recent poor performance. "I gave 15 years to the company and it was a large part of my career as a shareholder I've lost 30 per cent of my investment since Paul became CEO," McInnes moaned to the Financial Review. Zahra had earlier expressed his dismay over the closure of DJs' online retailing website in 2003, when McInnes was in charge.
Tree battle of the year
Philip Salter and Peter Mattick. The founders of the junk-mail company Salmat faced more protests over their Taphouse pub group's plans to prune a historic fig in the car park of the Chinderah Tavern in northern New South Wales. "Specialist veteran tree experts have advised the extensive pruning planned would be an indirect death knell," warned Tweed Shire Council's Greens councillor Katie Milne before a Christmas decoration protest at the tree.
Proposed personal insolvency agreement of the year
Bill Ireland. The founder of Challenger and the capsized Mariner Corp failed in his attempt to get his creditors to agree to a proposed personal insolvency agreement where he would pay back his creditors at least 0.25? in the dollar.
"I envisage an optimistic market for 2011 and consider that my capacity to earn income under a PIA will be greater than under bankruptcy," explained Ireland about his proposal to repay at least $150,000 of his $72.9 million in personal debts. On top of this he proposed to divert half of his income over the next three years to his creditors.