Lion roars fit to beat the ban and Hickie hikes to appeal
ASIC did not appear aware that Hickie late last month was granted a new financial services representative's licence. Photo: Jim Rice
INVESTMENT manager Lion Advantage's chief executive, David Hickie, is seeking suppression orders and a repeal of bans inflicted on him and his company by the corporate watchdog this week.
Hickie said, between gritted teeth, that he was off to the Administrative Appeals Tribunal to contest the two-year ban on him, and Lion's licence cancellation.
The Australian Securities and Investments Commission rained on Hickie's parade yesterday morning when it announced the cancellations, which stemmed from a surveillance of Lion in the past month. Hickie said he did not think there would be a public announcement because he was appealing.
In spite of that surveillance and action, ASIC did not appear aware, until Insider contacted it, that Hickie late last month was granted a new financial services representative's licence by an arm of VentureAxess Group where he is also an executive director.
VentureAxess, which has a board similar to that of Lion and featuring stockbroking veteran Richard Green, only rejoined the trading lists of the National Stock Exchange in May after a capital raising.
Insider has never known Hickie to shirk a corporate brawl. A few of them have been chronicled over the years where he has challenged incumbent boards, such as Base Resources and Mind Challenge. When Insider spoke with Hickie he was concerned not just with the publicising by ASIC of its actions against him, but that its release said he was banned ''from providing financial services for two years''.
That, said Hickie, did not make it clear if he could still act as director of public companies such as VentureAxess and another planned NSX listing, Island Concepts.
According to the ASIC announcement, Hickie and Lion's sins were their failure to have professional indemnity insurance, not lodging financial reports on time for Lion and the schemes for which it acts as manager, not holding membership of an approved dispute resolution scheme at specific times, failing to notify of significant breaches and not having adequate compliance measures.
Hickie said he was late with the reporting, but only because his business had been subjected to legal action, including seizure of a company car, which made it hard to get the auditor to sign off on the books. Hickie and ASIC do agree that reporting is now up to date .
Big ask for ASX
MOUSTACHIOED ASX chairman Rick Holliday-Smith, will bravely go into his first annual meeting in October explaining to investors why the sharemarket operators' directors merit more money.
While ASX reported a $13 million profit fall to $339 million yesterday, Holliday-Smith and the board did warn that they want to lift, by $300,000 to $2.8 million, the ceiling on payments to non-executive board members.
Insider hastens to add that they argue in the annual report that the proposed increase is ''to facilitate a process of board renewal'', rather than increase the annual salary for existing directors.
The last time shareholders voted through an increase we all lived in a vastly different world - 2007, at the peak of the sharemarket and profits were booming.
Since then, ASX has had to watch its lunch being cut by competitors, and market volumes dwindle amid global and domestic uncertainty. About the only thing that has risen in equities markets has been the number of transactions, thanks largely to high-frequency trading patterns, which feature many, many, tiny, tiny transactions.
In the past 12 months ASX non-executive directors received a collective $2.02 million, well shy of the current ceiling even though it included $293,000 paid to departed chairman David Gonski.
Four of the ASX's remaining seven non-executive directors face re-election at this year's meeting, including longest-serving director Jillian Segal, who has been on the board for nine years and plans to stand again.
ASX chief executive Elmer Funke-Kupper picked up a comparatively modest package of $1.97 million for his first nine months in the job, including a $500,000 cash bonus - only marginally less than the entire board's wages.
His bonus for the latest financial year was actually $1 million, but half has been deferred because ASX has joined with most leading companies in trying to ensure consistent performance under their incentive schemes rather than encouraging executives to shoot for short-term pay-offs.
As for shareholders, returns since the last board pay rise have been grim in share price terms (far from unique in the post-GFC world) with the value of their investment down almost 30 per cent over that five years. Total return, including dividends, improves to negative 6.75 per cent, but once the franking credits are loaded on investors can claim a 4.2 per cent improvement in their fortunes.