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Let's hope Van der Merwe won't be a joke at Trencor AGM


Let's hope Van der Merwe won't be a joke at Trencor AGM

Textainer shareholders gave his ego a bruising. Now he has to present his mediocre results to the Trencor mob

Ann Crotty

Trencor directors up for re-election at the annual general meeting, scheduled for next week, will be hoping to get more support from shareholders than Hennie van der Merwe got at the recent Textainer AGM.
Trencor’s 48% stake in New York-listed Textainer, which is one of the largest lessors of shipping containers in the world, is its dominant investment. Textainer’s weak performance over recent years explains why the Trencor share price has been on a steady downward path.
Van der Merwe, who is chairperson of Trencor, is a member of the Textainer board and received just 65.5% support for his re-election at the Textainer AGM in May. Remarkably 53.26% of shareholders didn’t even bother to attend or vote at the meeting, which is held in Bermuda where the company is registered.Attendance at Trencor AGMs is much more robust. At last year’s AGM 99.93% of Trencor’s shareholders voted to re-elect Van der Merwe and there was a hefty 93% attendance at the meeting.  The only resolution that caused a bit of a flutter was the vote on the remuneration policy, which received the thumbs down from 27% of the shareholders. It’s impossible to know whether this was the usual knee-jerk reaction from shareholders or reflected a concern about the level of remuneration being awarded to directors who are essentially just keeping an eye on the performance of Textainers’ executives.
Judging from the recent quarterly results from Textainer there’s not much return on all that oversight. The earnings of $0.31c a share represented a significant improvement on the comparative quarter in financial 2017 but were about 14% below market expectations. The performance has lifted the return on equity to 6%, which is in the right direction, but is distressingly below the 16% achieved by industry leader Triton.
The Textainer share price bounced up briefly before settling back at $14.50, way off the $26.50 12-month high reached in February.

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