Latest / What the Flux / Reece Plumbing's team gets a second strike | Ladbrokes owner cuts perks | Monash IVF faces a new challenge

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Reece Plumbing's team gets a second strike | Ladbrokes owner cuts perks | Monash IVF faces a new challenge · What the Flux

• 0:05
  Speaker 1: This is what the Flux.
• 0:06
  Speaker 2: I'm Brett and I'm justin and it's Monday, the twenty
• 0:08
  Speaker 2: fourth of novemb Josie Boy.
• 0:10
  Speaker 1: Despite invidious bumper results late last week, investors are still
• 0:14
  Speaker 1: shaking in their cash field booties. Get this one. The
• 0:16
  Speaker 1: Vicks Volatility Index, often called the fear gauge, jumped almost
• 0:20
  Speaker 1: twelve percent late last week. And the last time I
• 0:23
  Speaker 1: spiked this high was in April, when we're all worried
• 0:25
  Speaker 1: about a full blown trade war. This time there is
• 0:28
  Speaker 1: a specific event of concerns.
• 0:31
  Speaker 2: Even a bit more eerie then uh huh flapp As
• 0:33
  Speaker 2: we come towards the end of the month, if you
• 0:34
  Speaker 2: haven't checked out our academy course this month, it is
• 0:37
  Speaker 2: the perfect time. We know that getting into the property
• 0:39
  Speaker 2: market can feel as complicated as learning in Ourgebraic equation,
• 0:42
  Speaker 2: so we've covered the ins and outs of buying a property,
• 0:44
  Speaker 2: including tips for twenty twenty six. To make sure to
• 0:47
  Speaker 2: download the Flux app and check out the academy this month.
• 0:49
  Speaker 1: Three delightful stories today, Josy Boy, Let's do it for
• 0:53
  Speaker 1: our first, the executives at Reese the plumbing materials Wizards
• 0:58
  Speaker 1: have copped a second strike on their pay after shareholders
• 1:00
  Speaker 1: have lost their patients.
• 1:01
  Speaker 2: Nothing like a boardroom drama to spice up the plumbing.
• 1:04
  Speaker 2: I'le be man so.
• 1:06
  Speaker 1: Reese is the Australian plumbing and bathroom supplies giant, with
• 1:09
  Speaker 1: more than nine hundred branches across Australia and New Zealand
• 1:12
  Speaker 1: and more recently the US.
• 1:13
  Speaker 2: And well you might think it's all pipes and bathtubs,
• 1:16
  Speaker 2: Reese actually claims to be building a quote better world
• 1:19
  Speaker 2: for our customers.
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  Speaker 1: Pretty bold statement from Reese, and.
• 1:22
  Speaker 2: Over the past ten years's share price has gone to
• 1:25
  Speaker 2: boomtown YEAP.
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  Speaker 1: From twenty fourteen to twenty twenty four its shares were
• 1:28
  Speaker 1: up more than five hundred percent.
• 1:30
  Speaker 2: But in August this year, RAC's CEO ward that it's
• 1:32
  Speaker 2: earnings before interest and tax it's ebert felt twenty percent
• 1:36
  Speaker 2: in the last financial year.
• 1:37
  Speaker 1: Investors were not happy.
• 1:39
  Speaker 2: Jan yep So Now b Maan shareholders have delivered a
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  Speaker 2: protest vote on Raese's executive.
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  Speaker 1: Pay YEAP forty four percent of shareholders voted against the
• 1:47
  Speaker 1: current mineration after a thirty percent share price drop over
• 1:50
  Speaker 1: the last six months.
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  Speaker 2: And Beman this is the second strike against the Reese
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  Speaker 2: exec remuneration which actually triggered a bored spill vote.
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  Speaker 1: Now the big problem child, you ask, Well, it's a
• 2:00
  Speaker 1: US one point nine billion dollar acquisition of Morseco.
• 2:03
  Speaker 2: Yep, Mosco has been struggling in a soft US housing
• 2:06
  Speaker 2: market for shareholders.
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  Speaker 1: Reckon that if they're paying with a lower share price,
• 2:10
  Speaker 1: execs need to pay.
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  Speaker 2: Two And the second strike is a big deal in
• 2:14
  Speaker 2: Australian corporate governance, it.
• 2:15
  Speaker 1: Is, So what's the key learning here?
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  Speaker 2: When a company stumbles, the quickest placed shareholder's look is
• 2:20
  Speaker 2: the exec paypacket.
• 2:21
  Speaker 1: Now, a second strike is basically the corporate equivalent of
• 2:24
  Speaker 1: shareholders slamming the big red alarm button.
• 2:27
  Speaker 2: It essentially exists to keep public company boards accountable.
• 2:30
  Speaker 1: Works like this. Each year's shareholders vote on the company's
• 2:33
  Speaker 1: executive remuneration report. If twenty five percent or more shareholders
• 2:36
  Speaker 1: vote against it, that is a first strike. If the
• 2:39
  Speaker 1: same thing happens again the next year, it becomes a
• 2:41
  Speaker 1: second strike.
• 2:42
  Speaker 2: And once a company hits a second strike, it triggers
• 2:44
  Speaker 2: a whole board spill resolution.
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  Speaker 1: That forces shareholders to vote on whether the entire board
• 2:48
  Speaker 1: except the CEO should be removed and re elected.
• 2:51
  Speaker 2: And they've added well, Race's board survived the spill, it's
• 2:54
  Speaker 2: still pretty pretty embarrassing.
• 2:56
  Speaker 1: Well, it does send a clear message that investors are
• 2:58
  Speaker 1: not thrilled with company performed and executive pay, and.
• 3:01
  Speaker 2: Whether fair or not, shareholders expect leadership teams to share
• 3:04
  Speaker 2: the pain when results weak it.
• 3:05
  Speaker 1: For our second story, the owner of Ladbrokes and Neds
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  Speaker 1: in Australia is cutting jobs and winding back perks as
• 3:12
  Speaker 1: it tries to just stabilize its battling Aussie business, one.
• 3:15
  Speaker 2: Of the big plays in the betting space here, b Man,
• 3:17
  Speaker 2: that's big news. So what is the story?
• 3:19
  Speaker 1: So n Taine is the London listed betting giant that
• 3:22
  Speaker 1: owns lad Brokes on Neds, two of Australia's bigger online bookies, and.
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  Speaker 2: It's a big, big beast. Get this, And Tane had
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  Speaker 2: almost two million Oussie customers last.
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  Speaker 1: Year, which is around seventeen percent of the market share.
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  Speaker 2: And then Man, this restructure is expected to save them
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  Speaker 2: around sixty million bucks. And in Tanne isn't alone cutting
• 3:38
  Speaker 2: jobs in the gambling industry, b Man.
• 3:40
  Speaker 1: Nope, Star Entertainment and Crown Resorts are chopping senior roles
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  Speaker 1: as well.
• 3:44
  Speaker 2: Because the whole gambling industry is facing high costs and
• 3:46
  Speaker 2: a whole lot of regulatory heat.
• 3:48
  Speaker 1: But boy, that is not all. And Taine is also
• 3:51
  Speaker 1: rolling back work perks.
• 3:53
  Speaker 2: Yeah, it's forcing their staff to return to the office
• 3:55
  Speaker 2: two days a week from permanently working from home.
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  Speaker 1: And it's ending its nine day fortnight as well, not
• 4:00
  Speaker 1: the nine day fortnite. So what is the key learning here?
• 4:04
  Speaker 2: When unemployment rises and the talent market calls, companies often
• 4:07
  Speaker 2: become a lot less generous.
• 4:09
  Speaker 1: Yeah, the nine day Fortnite was originally rolled out to
• 4:12
  Speaker 1: attract and retain staff.
• 4:13
  Speaker 2: You know, right after that old pandemic, when the labor
• 4:16
  Speaker 2: market was extremely tight.
• 4:18
  Speaker 1: I do recall the unemployment rate was sitting at about
• 4:21
  Speaker 1: three point four percent, and.
• 4:22
  Speaker 2: Now the unemployment rates sitting around four and a half percent,
• 4:25
  Speaker 2: many jobs are a lot more competitive.
• 4:26
  Speaker 1: So as the balance of power shifts back towards employers,
• 4:29
  Speaker 1: many are winding these perks back.
• 4:31
  Speaker 2: If fact, be Men, Medibank, Booper, and now Intained have
• 4:35
  Speaker 2: all pulled the plug on the nine day.
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  Speaker 1: Fortnite Right now, companies are prioritizing cost control over talent
• 4:40
  Speaker 1: at all costs.
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  Speaker 2: And Intain's move is a pretty clear signal that the
• 4:43
  Speaker 2: talent boom of twenty twenty one to twenty twenty three
• 4:45
  Speaker 2: is fading pretty fast.
• 4:47
  Speaker 1: For our third and final story, monash IVF has reported
• 4:51
  Speaker 1: weaker than expected performance after it feels the after effects
• 4:54
  Speaker 1: of its embryo transfer mix ups.
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  Speaker 2: So as the clients now investors are also losing faith.
• 4:59
  Speaker 2: So what the story? So?
• 5:00
  Speaker 1: Monash IVF is the asxisted group that specializes in fertility
• 5:04
  Speaker 1: services in Australia.
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  Speaker 2: They do everything from IVF to egg freezing, to genetic
• 5:08
  Speaker 2: testing and a whole lot more.
• 5:10
  Speaker 1: Boy Earlier this year, monash IVF messed up big time.
• 5:13
  Speaker 2: They mixed up their clients embryo transfers not once, but twice.
• 5:18
  Speaker 1: And in one case they didn't realize until two years
• 5:20
  Speaker 1: later after a baby was already delivered.
• 5:23
  Speaker 2: Not a good look for Monoshavif.
• 5:25
  Speaker 1: No, it was a massive hit to Monoshavif's brand reputation.
• 5:28
  Speaker 2: And now they've reported weaker than expected performance for the
• 5:31
  Speaker 2: four months of this financial year.
• 5:33
  Speaker 1: Yep, they've been forced to drop their already reduced four
• 5:35
  Speaker 1: year earnings guidance by another eleven percent.
• 5:37
  Speaker 2: From twenty seven and a half mil down to just
• 5:40
  Speaker 2: twenty million dollars.
• 5:41
  Speaker 1: Neck minute monash IVF share price tumbled twelve percent.
• 5:44
  Speaker 2: It's no surprise neither clients or investors are very happy
• 5:48
  Speaker 2: with Monashchavif right now.
• 5:49
  Speaker 1: So what's the key learning here?
• 5:50
  Speaker 2: The industries that relate to life and death scenarios, trust
• 5:54
  Speaker 2: is its entire business model.
• 5:55
  Speaker 1: Once that trust is broken, the road to regaining it
• 5:58
  Speaker 1: can be long and slow and pretty expensive.
• 6:00
  Speaker 2: Remember Boeing b Man After two fatal seven three seven
• 6:04
  Speaker 2: Max crashes, the market wiped sixty percent of its peak value,
• 6:07
  Speaker 2: and after that airlines paused their orders, regulators grounded their fleets.
• 6:11
  Speaker 1: And even passengers were nervous getting onto a Boeing Max aircraft.
• 6:15
  Speaker 2: Even today, years on, it still hasn't returned to anything
• 6:18
  Speaker 2: close to its former heights.
• 6:19
  Speaker 1: So when a business is responsible for people's lives, it
• 6:22
  Speaker 1: just can't afford to make mistakes.
• 6:24
  Speaker 2: Yeah, so monashevv isn't just dealing with a bad quarter
• 6:26
  Speaker 2: and a bit of stiff competition. They're dealing with a
• 6:29
  Speaker 2: major loss.
• 6:29
  Speaker 1: Of trust, and rebuilding trust can be even tougher than
• 6:32
  Speaker 1: rebuilding revenue tame.
• 6:34
  Speaker 2: In this month's academy course, we go through buying property
• 6:37
  Speaker 2: one oh one house deposits and getting pre approved, everything
• 6:40
  Speaker 2: you need to know if you want to get into
• 6:41
  Speaker 2: the property market in the next three to six months.
• 6:44
  Speaker 2: To make sure to download the Flux app and check
• 6:45
  Speaker 2: out the Academy this month.
• 6:46
  Speaker 1: Thanks for listening and we'll see you on Wednesday.