This is my 2nd consecutive year attending the ST Engineering AGM as a shareholder. This year, it was held at the Amara hotel which I thought was quite uncomfortable and not spacious enough as compared to last year which was held at One Marina Boulevard.
Shareholders or appointed proxies who attended this year’s AGM were given a S$15 NTUC voucher, which I think is a whole lot better than a lunch buffet. Anyway, tea and coffee beverages were available to the shareholders and one uncle actually asked me where I get my sugar!!! 😀
Anyway, the Chairman (Mr. Peter Seah) started off the speech by thanking the crowd for coming and making his intention to step down as Chairman with effect on 25 April 2013. He thanked the shareholder for the support he has received as Chairman of ST Engineering and wish the shareholder to keep faith in ST Engineering in the years to come.
When it was time to pass the 1st resolution which was the audited financial statement related, a few questions came up from the crowd. One of the questions was relating to the impairment losses for bad debt in Notes 22 of the Audited Annual Report. Based on the report, allowance for bad debt increases year on year and this raises a concern for the aforementioned shareholder. Mr. Tan Pheng Hock (President and CEO) responded to this query by stating a fraud case in one of their business which resulted in the increase in the impairment losses for 2012. Mr. Tan also assured shareholders that this is a one off case and careful risk management is taken to ensure shareholders’ return.
Another question came up (which I have suspected) from another shareholder regarding the purchase of Neratel. The question was why did ST Eng not pursue Neratel further after the initial offer which was rejected. Being both ST Eng and Neratel shareholder myself, this certainly interests me. Mr. Tan responded to his query by saying that every business has a value and if the business does not meet the company’s criteria, they would simply walk away. Mr. Tan added by saying that they were previously very interested in one of Neratel’s business segment which would help their infocomm business but given the price they are now, they are overvalued and the company would not pursue the acquisition any further. Mr. Tan ended by saying that any acquisitions ST Eng made needs to meet the company’s criteria. Otherwise, they will simply walk away from it.
The rest of the questions were revolving around the order backlog, community involvement and others which I thought was ordinary and nothing special to take note of. I was actually quite surprised no one actually inquire about the huge drop in ST Eng price this morning, which has rebounded since. It almost gave me a personal shock.
I am vested with 1 lot of ST Engineering as of this writing.
Disclaimer: The above writing was based on my personal experience attending the AGM and interpretations and it may differ depending on how others interpret.