Incitec wings no longer bound by ammonia
Summary
“Now is a logical time to initiate strategic review with the business well positioned to benefit from the emergence of ag tech and to leverage its strong platform in the Australian market. Just on the changed outlook, when Incitec offered the original full-year guidance to investors back in May, the company made the point that this would be an exception to a rule that says their business is too volatile to support firm forecasting. Now, if I am a board in command of inevitably limited growth capital, then where am I logically going to spend it - on a business that operates on sub-10 per cent margins or on an alternative whose underlying demand patterns would seem to be more structurally secure? Kreiwaldt made a name for himself with the largely unexplained sacking of a widely admired chief executive who was getting to the pointy end of the company’s reconstruction, and then by losing two board nominees to resignation ahead of an annual general meeting that would have seen them voted out. The word is that the shareholder foment that fathered the protest vote has continued and Kreiwaldt has correctly read the runes and opted to let the business make a fresh start with its owners.