Judging from the media coverage of the PBL annual meeting yesterday and
looking at the meeting again in hindsight, it’s clear something hasn’t
quite caught on among the media and company.
PBL is now the country’s leading media group following the departure of News Corp for the management heaven that’s Delaware.

PBL’s media arms, Nine and ACP, plus Ninemsn makes more money than any
other media group in this country, around $489 million last financial
year on an earnings before interest, tax and depreciation and
amortisation basis.

That will rise to well over $500 million this year.

That makes it more profitable than Fairfax, more profitable than News
Ltd (which lumps the rump of its NZ interests into Australia). It is no
where anywhere near as big a media player as News was. But now the
Rupster has gone, PBL is our number one and will attract a greater flow
of investor interest because of the News Corp departure.

The one thing that does put some investors off is the concentration on
gaming/gambling, principally Crown and Burswood Casinos and the deal to
take a half interest in better exchange, Betfair, if it gets an
Australian licence.

So with the gaming proviso to one side, are the Packers capable of
filling the big shoes left by the department News Corp and its driving
force, Rupert Murdoch?

A comparison between the two meetings yesterday suggests the answer to
that question is ‘no’. From all reports, including those from Mr Mayne
of Crikey fame, the Murdoch-News effort went three and a half hours.
The PBL effort went 65 minutes.

The PBL meeting would have much shorter except for the questions raised
by Jack Tilburn, the veteran questioner (and sometimes pain)

News would have been shorter had the votes and various meetings not
taken up time, nor discussion from people like Mr Mayne.The now
customary after the meeting, press conference went for half an hour.
Nothing after the PBL meeting from the Packers or from the CEO, John
Alexander, a man who is as wedded to the low profile, keep everything
secret approach of the Packer family, as the Packers are themselves.

Shareholders left (as did the media) with the knowledge that like him
or not, Rupert Murdoch is a game bloke who doesn’t take much of a
backward step.

He even fronted up last year after the embarrassment of losing the vote
on executive options, he didn’t like it, but he was there, answering
questions, choking on the answers.

No such bravura efforts from the Park Street mob in Sydney at the Sheraton on the Park yesterday.

The difference with Rupert is illuminating. When he talks to the
meeting, he is speaking as the Executive chairman who knows all the
businesses, some better than others. But you do get a sense that this
man is passionate and lives the business.

There is no need for CEO Peter Chernin to speak. But he has done in the
past and you get the impression that here is another man who knows the
business, and lives it!

That’s an enormous contrast to the Packer family and PBL. James has
read a chairman’s address only for the past three or four years. And
that read yesterday for instance, like the stuff that appeared above
his name in the annual report.

No insight, no thoughts about what the company thinks about the present
and future. There appears to be a real terror of saying anything that
might upset the ‘old man’.

That might be unfair. Yesterday James Packer was more relaxed, smoother
and more quietly aggressive(with shareholder questioner, Jack Tilburn)
than ever before.

Tilburn’s boast at the end of last year’s annual meeting that he would
return this year to “skin you alive” was obviously bravado at the time.
The Packers, including Kerry, had him on toast. Here’s last year’s
Crikey report – Crikey, Tilburn and the Packers.

Tilburn did not help his case by being confused and not quite
understanding the report. But he is entitled to speak. And in the past
he has helped shareholders and terrorised boards at AGM’s. So it is
therefore a bit sad to see the Sydney Morning Herald’s CBD column refuse to name him and just refer to him as a ‘shareholder.

Like him or not, ‘mad’ Jack was the only person having a go among the vast throng of contented cows at the PBL AGM yesterday.

That the CEO, John Alexander didn’t speak to his CEO’s report in the
annual report was also verging on the arrogant. There were two snippets
of ‘new’ news revealed yesterday by James Packer. These were the new UK
magazine from the joint venture with Hearst and the appointment of the
Crown CFO, David Courtney to be CEO of Burswood.

Burswood got more words in a tortuous explanation of a motion to be put
to the meeting that was financial mechanical and not strategic.

The reasons behind the UK move with Hearst? Well, we have to divine
them from the ether. Why are they so afraid of talking about the
strategy and ideas?

Both could have been addressed by Alexander (especially with his ACP
CEO hat on) but he just sat there looking slightly smug and bored. Like
the man on his left, Sam Chisholm, now back among the ‘family’ and
looking tanned and self-assured (Sam has never lacked in
self-confidence).

Cons Press boss, Ashok Jacob looked, well, quiet and distant, perhaps
wondering who would lead India in the third test yesterday. But India
is a sore point with Ashok, Nine, PBL and the Packers. There were
losses of $400 million or more.

James Packer’s confidence will stand him in good stead when and if he
joins fellow scion, Lachie Murdoch, in the OneTel trial in Sydney that
ASIC is trying to get to the starting line. PBL CFO, Geoff Kleeman (who
used to be at Woolworths) was looking relaxed, despite his impending
call to the OneTel witness box.

And even though the Packers, sorry PBL shareholders, shouted themselves
sandwiches and a better spread post the meeting, shareholders at News
walked away with a nice show bag with some expensive stuff inside. A
farewell gift perhaps from the man. But it was something to go home
with.

PBL shareholders were left with a nice feeling about the higher
dividends (that’s where News differs from PBL!) and rising share price
(ditto), but no sense of a company that will now attract a lot more
attention.

Certainly the family and the board seem determined to keep it that way.
But they can no longer hide behind Rupert’s bigger shadow.

There is a question of confidence. Rupert has never lacked that, from
1954 and the old Adelaide News, onwards. The Packers, in contrast seem
a more pessimistic bunch, more worried about what people might say
about things they do. Rupe, he just shrugs a lot of the stuff off,
secure in the knowledge of his rightness.

The Packers are now first among our media players. Are they up to it?

==========================

Crikey at the PBL AGM
Subscriber email October 26

In Sydney, Australia’s about to be largest media company held its
annual meeting, seemingly oblivious to the historic events in Adelaide.

No questions from shareholders at the PBL meeting about the impact on
the Packer company from the News departure. I would have thought the
sell-off in News Corp shares would mean the PBL shares will be a little
more firmer as institutions lift their weighting in the stock as News
is dropped out of the market indicies.

But no one was interested.

So was there any insight from the Packers. Nope. Nothing. They are
making a great return, the share price has been firm, earnings are
good, dividends are higher (which helps them personally with over $100
million last year in income).

The board looks as complacent and confident as before, even with the
addition of Chris Anderson, the mentor of CEO John Alexander and a
rather tanned looking Sam Chisholm who merely smiled slightly and
looked all knowing about everything.

They, along with Rowen Craigie, the Crown king, and the two Packers,
were re-elected without much comment, except for some tiresome (for
shareholders not the board) questions from Jack Tillburn.

Rowen Craigie is more and more looking like someone who should be
leading a horse in at Fleimngton this Saturday or next Tuesday. He
doesn’t look CEO material, so JA is safe (if he was ever in any doubt).

If Tillburn had stayed away the 65 minute meeting would have been cut
to less than 40 minutes quite easily. There would have been four or
five others questions.

But the Packers have opted to try and do something for shareholders.
Instead of tea and bikkies, there were nice Sheraton-style finger
sandwiches. Obviously times are good at Park Street.

Kerry Packer was cheered the only time he spoke in a non-formal sense.
The meeting had been wrapping up. Chairman James Packer asked, “any
last questions’? Tillburn got up and asked his most rational one, about
the whether the company would be doing anything after any possible
media law changes after the election . Kerry Packer, who had started
walking out as his son was wrapping things up, looked back over his
shoulder and “Get rid of You” to Tillburn. It earned him a laugh and a
big round of applause as he shuffled out of the Ballroom at the
Sheraton on the Park.

And that was the real story from the meeting. Kerry Packer does not
look 100% fit, he looked weaker than a year earlier and he also looks
smaller in statue, and he seems to be in pain.

In contrast Sam Chisholm, after his double lung transplant, looks in ruder health than does Kerry Packer.

But Kerry Packer does control the room and clearly all shareholders
were waiting for some comment from him. Unfortunately there was
nothing, nor did any one have the courage to raise the health question.

Arriving at the Sheraton I was rather surprised and my heart skipped a
beat or two (which is dangerous for me) when I saw two ambulances
outside. “Oh, no I thought, this is where the PBL meeting with Kerry
Packer and Sam Chisholm, both transplant recipients, are attending.
Hope nothing has gone wrong”. But all was well on that front, but not
for an unfortunate cyclist who seems to have been knocked down.

But with News on its way to the US, other media stocks were chased by
investors. PBL up by 40c a share in the early afternoon to $14.49, Ten
up 5c to $3.95, Fairfax up 5c a well to $4.06.

The market cap of PBL is now well over $9.577 billion and the Packer’s
share of that is around 36% or just under $3.6 billion. That 40c a
share rise took the market cap up more than $264 million during Tuesday.

Clearly investors see PBL as a major beneficiary of News Corp’s
departure, helped by a bullish comment today from James Packer that
advertising for the group, remained strong.

What else? The new UK joint venture for ACP and Hearst has produced a
new magazine called Reveal, and the CFO at Crown, David Courtney has
been shifted to Burswood Casino and made CEO. And there is a new
magazine from ACP due to be launched tomorrow for women without
children and which will probably be called Madison, all thing being
equal and no last minute changes.

Peter Fray

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