Directors' cut gets fillip
Scott Technology's directors' pay pool has been boosted $100,000 to $300,000 after the company posted a good result in a tough year.
In the year to August 31, the company made $6.1 million, up 17 per cent on the previous year, and paid out a similarly improved total dividend of 8c a share.
At the company's annual meeting in Christchurch yesterday, chairman Stuart McLauchlan asked shareholders for the increase to account for added work for the four board members as the company had grown.
Managing director Chris Hopkins was paid $461,000 and is not entitled to the directors' remuneration pool.
The directors' pool had been set at $200,000 since 2010.
One shareholder said he would not ordinarily agree to such a large increase, but was happy to support it this time because he believed it was deserved.
Another questioned the company's lack of details regarding director meetings and attendance in the annual report, and said the company should look to increase the number of directors.
McLauchlan said the board would take those comments on board; after the meeting he told The Press there had been 100 per cent attendance at all meetings.
The meeting was held in the company's Christchurch Bromley factory, with evidence of its export work on display.
A $6.5m stove-top production line for an American customer was getting the finishing touch from Scott staff for shipment before Christmas. The project took just seven months to design and build.
The machine would not be enough for the American company's plans and there was a good chance the build of another would be on the cards, McLauchlan said.
The company had also secured an $11m deal, through its joint venture with Silver Fern Farms, to set up lamb boning room automation for two Aussie meat processors by the end of next year.
There were many projects in the pipeline as well as forward orders that Scott was trying to nail down. If they were secured, the company would be in a strong position, he said.
Despite slow global growth, the United States was, surprisingly, looking like recovering quite well with a predicted 3 per cent growth during the next year, he said.
That would be a boon to Scott because almost 40 per cent of its business is done in North America and Mexico.
Managing director Hopkins said Scott tried to build for where it saw the future. That meant projects would sometimes fail, but it kept the company on the leading edge, Hopkins said.
The company's improved result under difficult conditions was pleasing, he said.
"We've had to work hard, accept reduced margins and leverage off our reputation and renowned skills."
An increase in mining exploration was promising for Scott, which makes just over half its sales from sampling machines for miners, he said.
There did not appear to be a slowdown in mining for precious metals, where Scott supplies, and the high gold price reinforced that, he said.
The mining industry had a "burning desire" to automate, Hopkins said. In September, Scott agreed to buy Western Australian company Integrated Conveyor Systems subject to due diligence, which ends in June.
The company made a conveyor that tightened at the top, enclosing the carried material, allowing the conveyor to turn quicker and go up and down. It was being eyed by a large mining company and would be a good fit with Scott's mining sample preparation business, he said.