Notice of Annual General Meeting 2015
To be held at PricewaterhouseCoopers,
201 Sussex Street, Sydney, New South Wales Friday 20 May 2016 at 11.00am
The entry to PricewaterhouseCoopers is located the corner of Sussex and Druitt Streets. Please
up the escalator and head towar
is immediately
through
King St Exit
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P
Wynyard
Sussex St
Kent St
P
T
P
T
Market St
Darling Harbour
George St
Druitt St
Cockle Bay Wharf
Western
Distributor Fwy
PricewaterhouseCoopers 201 Sussex St
Town Hall
Central
INVOCARE LIMITED ABN 42 096 437 393
Chairman's Message
Review Confirms Strategy
InvoCare has once again delivered a healthy financial result for 2015 derived from adherence to its proven business strategy.
The ongoing focus on the core strategic growth pillars embodied in InvoCare's operational strategy enabled the company to continue to grow. The strategy was reviewed and reaffirmed by both the Board and management during 2015.
Operating earnings after tax grew by 6.9% to $49.4 million for the year with a very strong second half performance from the core business operations. Statutory profit after tax, which includes asset sale gains, impairment charges, and the non-cash impact of movements in prepaid contracts funds under management and associated liabilities, increased to $54.8 million.
The financial results for 2015, building, as they do, on the results of previous years, confirm the integrity of the Company's existing strategy. Those results also give the company the confidence to continue exploring the possibility of acquisitions
in its existing markets, albeit that those possibilities might be more constrained than in the past, and to identify opportunities for greenfield developments. Additionally, and importantly, the results give the company the assurance that, subject to appropriate disciplines, it has the capacity to pursue
new core markets of the kind currently being investigated in the USA.
Of course, this activity is sustained by the company's ongoing and core business. The engagement of Martin Earp as the Company's CEO has permitted it to review those activities with the benefit, so to
speak, of a fresh pair of eyes. The strategic review which Martin led late in the course
of 2015 has identified ways in which those business activities might be conducted more profitably and the means by which the
company might secure a greater return from its existing assets.
2015 saw of period of Board renewal with Roger Penman who had been on the Board since 2005 standing down due to personal circumstances. Roger has been replaced
by Joycelyn Morton, who joined the Board during the year, as Chair of the Audit, Risk
& Compliance Committee. Aliza Knox also resigned from the Board during the year
and has not been replaced. On behalf of the Board and all shareholders I would like to thank both Roger and Aliza for the extensive contributions to InvoCare.
All the management and staff of InvoCare deserve a special thank you for delivering solid financial results during 2015. The Board, during its visits to various operational locations, continues to be impressed by the professionalism, dedication and sense of vocation of InvoCare's personnel.
I look forward to InvoCare's continued successful growth and the ongoing success of its core business operations in Australia,
New Zealand and Singapore as well as the growth of its recently established US
operations as this market is entered for the first time.
I personally encourage all shareholders to attend the Annual General Meeting to hear more about the 2015 results, receive an update on 2016 trading to date and hear about strategies for the future. Everyone who attends will have the opportunity to raise issues of interest or concern.
Richard Fisher AM
Chairman
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Operating Earnings
$49.4m
Operating earnings after tax grew by 6.9% to $49.4 million for the year.
Dividends
4.1%
Increase of total dividends for the year to 38 cents per share.
Cash conversion ratio
97%
Strong operating EBITDA to cash conversion ratio.
Five year Financials
$'000 | 2015 | 2014 | 2013 | 2012 | 2011 |
Revenue from external customers | 436,371 | 413,011 | 385,352 | 368,652 | 321,113 |
Operating EBITDA | 105,426 | 101,082 | 95,072 | 93,026 | 81,802 |
Operating EBITDA margin | 24.2% | 24.5% | 24.7% | 25.2% | 25.5% |
Operating earnings after tax* | 49,366 | 46,191 | 42,498 | 42,479 | 36,406 |
Operating earnings per share (cents) | 45.1 | 42.2 | 38.9 | 38.8 | 34.5 |
Profit after tax attributable to members | 54,844 | 54,515 | 48,869 | 44,479 | 27,012 |
Earnings per share (cents) | 50.1 | 49.8 | 44.7 | 40.6 | 25.6 |
Dividend paid in respect of the financial year (cents) | 38.00 | 36.5 | 34.5 | 34.0 | 29.75 |
Ungeared, tax free operating cash flow | 102,618 | 104,721 | 105,170 | 86,416 | 75,120 |
Proportion of EBITDA converted to cash | 97% | 106% | 110% | 95% | 92% |
Actual capital expenditure | 22,035 | 26,665 | 19,264 | 18,412 | 16,723 |
Net debt | 222,093 | 218,864 | 215,057 | 217,136 | 209,114 |
Operating EBITDA/Net interest (times) | 8.8 | 8.0 | 6.8 | 6.7 | 6.7 |
Net debt/EBITDA (times) | 2.1 | 2.2 | 2.3 | 2.3 | 2.5 |
Funeral homes (number) | 231 | 234 | 237 | 232 | 226 |
Cemeteries and crematoria (number) | 16 | 14 | 14 | 14 | 14 |
Employees (full-time equivalents) | 1,557 | 1,532 | 1,470 | 1,470 | 1,430 |
Prepaid contract sales per 100 redemptions | 115 | 108 | 115 | 116 | 122 |
* Operating earnings after tax excludes the net gain/(loss) on undelivered prepaid contracts, gain/(loss) on sale, disposal or impairment of non-current assets and non-controlling interests.
InvoCare Notice of Meeting 2015 3
InvoCare Notice of Annual General Meeting
Notice is hereby given that the Annual General Meeting of members of InvoCare Limited (Company) will be held at the offices of PricewaterhouseCoopers, 201 Sussex Street, Sydney, New South Wales on Friday 20 May 2016 at 11.00am.
Ordinary business
Item A - Financial reports
To receive and consider the Financial Report, Directors' Report and Independent Audit Report of the Company and its controlled entities for the year ended 31 December 2015.
Item B - Adoption of remuneration report
To consider and, if thought fit, to pass the following ordinary resolution:
Resolution 1
"That the Remuneration Report (which forms part of the Directors' Report) for the year ended 31 December 2015 be adopted."
Note: The vote on this resolution is advisory only and does not bind the directors or the Company.
Item C - Election of directors
To consider and, if thought fit, to pass the following ordinary resolutions:
Resolution 2
"That Richard Fisher, who retires by rotation in accordance with the Company's Constitution, be re-elected as a director of the Company."
Resolution 3
"That Joycelyn Morton, being a Director appointed by the Board since the last Annual General Meeting, and who retires in
accordance with the Company's Constitution, be elected as a director of the Company."
Item D - Approval of the grant of performance rights and options to Martin Earp for the 2016 financial year
To consider and, if thought fit, to pass the following ordinary resolution:
Resolution 4
"That approval be given, for the purposes of Rule 10.14 of the ASX Listing Rules, and for all other purposes, for the Company to grant to Mr Martin Earp, currently the Chief Executive Officer and Managing Director
of the Company (Mr Earp), Performance Rights and Options to a value of $513,000 for the 2016 financial year in accordance with the rules of the Performance Long Term Incentive Plan and as set out in the
Explanatory Notes accompanying this Notice of Annual General Meeting."
Item E - Approval of termination benefits to Andrew Smith
To consider and, if thought fit, to pass the following ordinary resolutions:
4
Resolution 5
"That approval be given, for the purposes of Sections 200B and 200E of the Corporations Act and for all other purposes, for the Company to pay and provide to Mr Andrew Smith, the Company's former Managing Director and Chief Executive Officer (Mr Smith), in connection with his cessation of employment with the Company, termination benefits being a short term incentive cash payment of $44,072, as described in the Explanatory Notes accompanying this Notice of Annual General Meeting."
Resolution 6
"That approval be given, for the purposes of Sections 200B and 200E of the Corporations Act and for all other purposes, for the Company to pay to Mr Smith, in connection with his cessation of employment with the Company, termination benefits being cash
in lieu of long term incentive shares as calculated and described in the Explanatory Notes accompanying this Notice of Annual General Meeting."
Explanatory Notes
Item A - Financial reports
The Corporations Act requires the Financial Report (which includes the financial statements and Directors' Declaration), the Directors' Report and the Independent Audit Report of the Company to be laid before the Annual General Meeting.
There is no requirement either in the Corporations Act or in the Company's Constitution for shareholders to approve the Financial Report, the Directors' Report or the Independent Audit Report. Shareholders will be given a reasonable opportunity at
the meeting to ask questions and make comments on these reports.
Item B - Adoption of remuneration report
Resolution 1 - Adoption of remuneration report
In accordance with Section 250R(2) of the Corporations Act, the Remuneration Report is put to shareholders for adoption. The Remuneration Report is set out on pages 29 to 41 inclusive of the 2015 Annual Report and is available on the Company's website at www.invocare.com.au.
The vote on this resolution is advisory only and does not bind the directors or the Company. Shareholders will be given a reasonable opportunity at the meeting to ask questions and make comments on the Remuneration Report.
Voting Exclusion Statement
In accordance with the Corporations Act, a vote on Resolution 1 must not be cast (in
any capacity) by or on behalf of any member of the key management personnel of the Company, details of whose remuneration are included in the Remuneration Report, or a closely related party of such a member.
However, such a person described above may cast a vote on Resolution 1 if:
the person does so as a proxy appointed by writing that specifies how the proxy is to vote on Resolution 1; or
the person is the Chairman of the Meeting and the appointment of the Chairman as proxy:
does not specify the way the proxy is to vote on the resolution; and
expressly authorises the Chairman to exercise the proxy even if the resolution is connected directly or indirectly with the remuneration of a member of the key management personnel of the Company.
Item C - Election of directors
Resolution 2 - Re-election of Richard Fisher
Richard Fisher retires by rotation in accordance with the Company's Constitution and, being eligible, offers himself for re-election.
Qualifications of Richard Fisher AM MEc LLB
Richard Fisher has been a director of InvoCare Limited since 24 October 2003. He was appointed Chairman of the Board on 22 October 2013. He is currently also Chairman of the Nomination Committee and a member of the People, Culture & Remuneration Committee.
Richard is General Counsel to The University of Sydney and is an Adjunct Professor in
its Faculty of Law. Richard is the immediate past Chairman of Partners at Blake Dawson (now Ashurst) and specialised in corporate law. He is also a director of Sydney Water. Richard is formerly a part-time Commissioner at the Australian Law Reform Commission,
an International Consultant for the Asian Development Bank and a Member of the Library Council of NSW. Richard holds a Master of Economics from the University of New England and a Bachelor of Laws from the University of Sydney.
Independent director
The Board considers Richard Fisher to be an independent director.
Invocare Limited issued this content on 13 April 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 12 April 2016 23:59:32 UTC
Original Document: http://www.invocare.com.au/content/dam/invocare/InvoCare Corporate/documents/announcements/IVC Notice of Meeting - Annual Report 2015 - AGM.pdf