Shares in investment manager Perpetual have slumped after the company said it won’t post an improved performance in the first half of the financial year.
But Perpetual has escaped a “second strike” against its executive pay policy, and says a company-wide overhaul is progressing well.
Chief executive Geoff Lloyd told Perpetual’s annual general meeting on Thursday that difficult global economic conditions have significantly influenced investor confidence.
He said the company expects to make an underlying profit in the range of $30 million to $35 million in the six months to December 31.
That would be slightly less than or at least in line with a $34.7 million underlying profit in the previous corresponding period.
“This outlook is subject to there being no material deterioration in financial markets and business conditions over the remainder of the 2012 calendar year,” Mr Lloyd said.
Perpetual shares were down $1.14, or 4.1 per cent, at $26.80 at 1525 AEDT.
The company avoided a potential board spill when about 90 per cent of its shareholders supported Perpetual’s executive remuneration report, which included a 16 per cent pay cut for Mr Lloyd.
Around 26 per cent of shareholder votes went against the report at the 2011 meeting, and a similar result on Thursday would have resulted in several board positions being vacated under new regulations.
The scaling back of executive members and reductions in their pay is part of a major restructure Mr Lloyd has accelerated since being appointed in February.
The program, which he has called Transformation 2015, is aimed at achieving $50 million in pre-tax savings each year from 2015.
“Progress has already been made towards these objectives during the 2012 financial year, with a major reduction in our cost base,” he told the meeting.
“Since then, we have made further significant progress with Transformation 2015 and we are on track to meet our objectives.”
Perpetual continues to make changes at board level, with director Philip Twyman announcing he will end his eight years with the company at the end of November.
Two new board members, Craig Ueland and Sylvia Falzon, were elected at the meeting.
