Shareholder ‘concerns’ remain after Fletcher GIB crisis meeting
Concerns remain over GIB’s New Zealand bid, with investors saying Fletcher Building showed a lack of ‘humility’ during a meeting in Auckland today.
The GIB shortage has caused major delays in the construction industry, with builders talking about their inability to source products and major delays on projects.
Fletcher’s Winstone Wallboards has a 94% stranglehold on New Zealand’s plasterboard supply.
The issues prompted Simplicity Living’s Sam Stubbs and the Shareholders’ Association’s Oliver Mander to call a please explain meeting with Fletcher’s senior management, including chief executive Ross Taylor.
Simplicty owns $35 million worth of shares in Fletcher Building and recently canceled all GIB purchase contracts for 550 affordable housing units in Auckland.
After Friday’s meeting, Mander told 1News there was a frank and open discussion on the matter.
While Fletcher offered some steps on managing customer impact, there were no excuses.
“We retain some concerns about aspects of corporate governance at Fletchers, in particular risk-related elements and how the business has assessed that particular risk and its impact on shareholders and customers,” he said. he declares.
“And we didn’t see the humility that we might have expected from a company that found itself in this situation.”
Although there had been a “perfect storm” with the Covid disruptions and increased demand, he remained concerned that the risk had not been identified by the company.
Stubbs said it was “clear” Fletcher was not the company to pull New Zealand out of the crisis.
“It is time for the government to step in and ensure that we have a normal competitive market like everywhere else in the world.
“They should create a competitive playing field, which we clearly don’t have at the moment. You can’t have a company that has 95% market share in a really basic material like plasterboard.”
Fletcher said he will open a new factory near Tauranga in a year and is working around the clock to produce more products.
Taylor previously said the company couldn’t have seen supply and demand issues ahead of time.
On Thursday, Winstone Wallboards said it would be able to supply retail customers with an additional million square meters of plasterboard from July to September.
“We understand the issues affecting the industry and, given our unique role as one of New Zealand’s last large-scale manufacturers, we have done and will continue to do everything we can across all of our operations to mitigate the situation,” Taylor said.
Taylor would not speak to 1News about the meeting on Friday, but explained how he was ramping up production and working with other offshore suppliers.
He also asked traders to have an allowance available for small businesses.
He did not say whether the company had let down any customers or investors, but said after reflection they should have given more thought to creating an emergency product pool.
“In retrospect, we had that in January.”
“It’s disappointing to leave customers short, but we’re working really hard.”