Jamie Pherous, CEO of Corporate Travel Management in Brisbane.
Jamie Pherous, CEO of Corporate Travel Management in Brisbane.

Island escape after week from hell

JAMIE Pherous made plans about a year ago to celebrate his 50th birthday at the ultra-luxurious Qualia resort on Hamilton Island.

Little did the high-flying Brisbane bizoid know then that this weekend's celebration with family and friends, some of whom are flying in from overseas, would come at the end of a week from hell.

The Corporate Travel Management boss has been under the pump since Sunday and on Wednesday his firm counterattacked against a short-selling assault by Sydney-based VGI Partners.

The company refuted all but two of the 20 criticisms levelled by VGI at the standing-room only AGM in Brisbane and appeared to win over investors in attendance despite worries about their portfolios.

Pherous stressed the company had previously weathered short-sellers in its 25-year history and had just enjoyed "a very strong year'' with "great numbers''.

The current financial year is off to a bullish start and an expected pre-tax profit of about $150 million is at the top end of guidance, he told the crowd.

The upbeat defence even earned Pherous a round of applause from punters, who lost quite a bit on paper when CTM shares resumed trading yesterday.

Despite the outward display of confidence, it was telling that chairman Tony Bellas, who was due to step down at the meeting, has agreed to stay on to "maintain stability'' until his successor is picked.

That suggests CTM is a bit more worried about the fallout from the VGI ambush than they are letting on.

ELEPHANT PRESENT

AS soon as he took the microphone to kick off the meeting, Bellas wasted no time in addressing the 900-pound elephant in the room.

He noted that VGI had not offered to share the highly critical report on the company or sought to discuss its contents before release.

But that doesn't square with the account from the VGI camp, which found it very tough to get straight answers about anything from CTM.

"While we have sought to raise questions with management in recent weeks, responses to date have failed to address many of the more substantive issues,'' VGI said at the weekend.

Bellas, in a bid to punch holes in the VGI report, said the CTM office in Glasgow had moved in May.

Yet VGI used an outdated photo of a former office to suggest there was merely a "phantom'' presence in the city, he pointed out.

Equally, an airport kiosk in the remote Alaskan outpost of Dutch Harbour which VGI described as a "skeleton office'' was in fact providing key services to the fishing industry and FIFO workers, Bellas said.

He even joked that CTM board member Bob Natter, a former admiral in the US Navy, had paid a quick visit to the office in a nuclear-powered submarine!

Bellas demanded that VGI correct or withdraw its scathing report, which he claimed "misunderstands or misrepresents CTM's financial performance, governance and business model''.

But VGI dug in on Wednesday and a spokesman said it might even add to its short position on just over 2 million CTM shares.

CTM's "lacklustre disclosures…have only reinforced our view that the underlying quality of the business has been misjudged by the market,'' he said.

TONE DEAF MOVE

RICHARD Hinson, who only took on the CEO's job at embattled Retail Food Group in late May, is already enjoying some serious downtime.

Hinson is in the midst of a month-long vacation through the US, according to a deeply frustrated franchise owner who contacted your diarist this week.

How does our struggling retail trader know? Well, in a remarkably tone deaf move, Hinson provided details of his travels in a newsletter to his troops.



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