Charter Hall Retail REIT (CQR) Earnings Call Transcript & Summary

Ladies and gentlemen, thank you for standing by, and welcome to the Charter Hall Retail REIT 2020 Extraordinary General Meeting. [Operator Instructions] Please note that this virtual meeting is being recorded today, Tuesday, 7 April 2020. I would now like to hand the meeting over to your host today, Mr. Roger Davis, Independent Chair, Charter Hall Retail REIT. Thank you, sir. Please go ahead.

Thank you very much. Well, good morning, everyone, and on behalf of the Board of Directors, it's my pleasure to welcome you all to the extraordinary general meeting of unitholders of the Charter Hall Retail REIT. My name is Roger Davis, and I am the Chair of the Charter Hall Retail REIT Board of Directors. Could I request that you now take a moment to ensure that your audio connection is on mute? This is a digital meeting, and it's very important that you follow those instructions. It's now 10:00 a.m., and as the necessary quorum is present, I declare this meeting properly constituted and open. This morning, we will consider the formal business of the meeting being an ordinary resolution for your consideration relating to the ratification of the institutional placement. I would also like to note that the institutional placement proceeds were applied to the acquisition of an additional stake in the BP portfolio, taking CQR's ownership to just under half of the Charter Hall managed fund that owns those assets with the balance of residual money raised used to pay down debt. The BP portfolio now represents 9.5% of CQR's income and is an excellent addition to CQR, providing steady and growing income to unitholders via annual CPI rent increases and an attractive capital structure where BP are responsible for all capital works associated with the properties. The average 20-year lease expiry across the portfolio also ensures income security for many years to come. I would now like to introduce my fellow Board members who are present on the webcast today: Sue Palmer, an Independent Director, who's Chair of the Audit, Risk and Compliance Committee; Michael Gorman, Independent Director and a member of the Audit, Risk and Compliance Committee; Greg Chubb, CEO, Retail and Fund Manager for Charter Hall Retail REIT; and finally, I introduce Charter Hall Managing Director and Group CEO, David Harrison. Also present today and I welcome Mark Bryant and Charisse Nortje, our Joint Company Secretaries; Christine Kelly, our Head of Retail Finance and Deputy Fund Manager for CQR. We will now proceed with the items of business of the meeting. As this is a relatively new technology for conducting an AGM, I'd like to ensure you're familiar with the way we will proceed this morning. There is only one resolution for today's meeting, which we will come to shortly. For those shareholders participating in the meeting via the online platform, you can cast your direct vote using the electronic voting card that you received when you validated the registration. If you have not, at the bottom of the web page, you should see that there are 3 boxes: Get a Voting Card, Ask a Question or Download. To register to vote, click on the Get a Voting Card box at the bottom of the web page or below the videos. You will need to register by providing your details as either an individual or a proxy. Once you have registered, your voting card will appear with today's resolution to be voted on. Unitholders and proxies can either submit a full vote or a partial vote. You can move between the 2 tabs by clicking on Full Vote or Partial Vote at the top of the voting card. Once you finish voting on the resolution, scroll down to the bottom of the box and click the Submit Vote button. If you want to ask a question, you will only be able to ask a question after you've registered to vote. If you would like to ask a question, click on the Ask a Question box either at the top or bottom of the web page. And if you would like to view the Notice of Extraordinary General Meeting, click on the Downloads button. This is all complicated, and I do appreciate you bearing with us on this. But if you have any questions or any procedural matters, please don't hesitate to inquire on the helpline. I'd now like to move to today's formal business. I now table the Notice of Meeting dated the 12th of March 2020, which contains the resolution up for consideration today. A copy of the Notice of Meeting would have been made available to you by mail, e-mail or, as previously mentioned, is available to view on the web page. I'd also like to point out that the Notice of Meeting outlined a second resolution for your consideration today. That resolution was to ratify the unit purchase plan, or UPP, which allowed retail investors to participate in the equity raising that took place on February 26 at a unit price of $4.81. Your directors exercised their discretion to discontinue this offering and withdrew it on the 19th of March. We felt it was unfair for any unitholders that have subscribed for units in the UPP to acquire units at a price which was by then significantly above the current trading price. Hence, we withdrew the UPP and refunded application monies that we had received. As a consequence of withdrawing the UPP, resolution 2 has been withdrawn from today's meeting. I will now take the Notice of Meeting as read and move to item 1 in the Notice of Meeting, ratification of the institutional placement. The resolution is displayed on the screen. This resolution is an ordinary resolution and, as you can see, is displayed on the screen. There are some voting exclusions that apply, and these were outlined in the Notice of Meeting. I now declare the poll open and ask all unitholders who have not already voted or submitted their vote via proxy to review the resolution currently displayed. [Voting]

I will now display the respective proxy votes received on the screen. These are all overwhelmingly in favor of the resolution with a 99.18% vote in favor and only a 0.48% vote against. If you haven't already done so I would encourage you to fill out the online voting form. I now declare the poll closed. Link Market Services is assisting us today with the voting process as well as the counting of online votes, and they will scrutinize the counting. The results of the meeting will be lodged directly with the ASX shortly following the meeting, but from proxies received, I think you'll have a good indication as to how the voting will go. As there is no other business to be considered, I'd like now to pause and see if there are any questions. Just waiting to see if there are any questions that come through. There don't appear to be any. Of course, this is a digital meeting. We'll just make sure that if people are trying to work their way through the complicated process, we've had adequate time. Okay. Well, there do not appear to be any questions. And as there is no other business to be considered, I thank you for your attendance and now declare the formal business of the meeting closed. Thank you very much for your attendance. Good morning.