BRISBANE, Australia,
Nov. 23, 2017 /PRNewswire/
-- Orocobre Limited (ASX: ORE, TSX: ORL ) ("Orocobre" or
"the Company") wishes to announce that all resolutions were
passed as ordinary resolutions following a poll at the Annual
General Meeting held on 24 November
2017.
Details of the votes cast are as follows:
Resolution
|
For
|
Against
|
Abstain
|
1. Adoption of the
Directors' Remuneration Report
|
82,044,179
(96.04%)
|
3,386,843
(3.96%)
|
293,535
|
2. Re-election of Mr.
John W. Gibson as a Director
|
96,245,095
(99.37%)
|
609,205
(0.63%)
|
192,296
|
3. Re-election of Mr.
Courtney Pratt as a Director
|
96,451,917
(99.57%)
|
414,124
(0.43%)
|
180,555
|
4. Grant of
Performance Rights to the Managing Director & CEO, Mr. Richard
Seville
|
87,886,116
(96.07%)
|
3,599,105
(3.93%)
|
227,758
|
5. Approval for the
giving of Retirement Benefits to the Managing Director &
CEO, Mr. Richard Seville
|
90,412,891
(98.80%)
|
1,093,554
(1.20%)
|
206,534
|
6. Proposed increase
in Non-Executive Directors' Remuneration
|
90,390,228
(98.89%)
|
1,013,451
(1.11%)
|
247,118
|
2017 AGM Chairman's Address
Good morning and welcome to the 2017 Annual General Meeting of
Orocobre Limited. My name is Robert
Hubbard and I am the Chairman of Orocobre and I will Chair
today's meeting.
I would like to start by introducing my fellow members of the
board and the Orocobre executive management team who are with us
today. Richard Seville is our
Chief Executive and Managing Director and he is joined by
Leanne Heywood, a non-executive
director. Also with us are our joint company secretaries,
Neil Kaplan, the CFO of Orocobre and
Rick Anthon, the head of corporate
development and general counsel. In the audience with you are
other members of our Corporate office. Also with us today is
Brad Tozer from our auditors Ernst
and Young.
As you all know your board is very culturally and geographically
diverse with representatives from Argentina, USA and Canada, in addition to Australia. We
have again decided to minimise expenditure for the meeting and my
overseas colleagues on the board are all apologies today.
We have before us today six resolutions for consideration.
Prior to consideration of the formal agenda I will give a short
address and Richard will provide his more comprehensive
presentation. There will be opportunity for questions at the
conclusion of Richard's presentation (released to ASX on
14 November 2017), however if you
have any questions specific to a resolution could you please raise
them when we come to that resolution.
The operating environment
The market fundamentals remain very positive for lithium and
Orocobre. Discussion on the impact of electric vehicles and their
likely market penetration remains at a superficial level in
Australia, however this is
contrary to many countries and in particular Europe, North
America and China. We
believe the move to EVs is now irresistible with a corresponding
impact on the demand for lithium.
In Argentina, the recent
mid-term elections endorsed the national reform agenda of President
Macri and the progress being made by Governor Morales in the Jujuy
province. Orocobre is supportive of the direction being
pursued by the President and Governor and we look forward to
further fiscal and economic reform as Argentina continues its journey of returning
to the global economy.
Collectively, these factors are producing a much improved
operating environment for Orocobre compared to the Olaroz
construction and early operating periods, although inflationary
pressures remain.
Review of performance
The annual report explains in depth the operating and financial
performance of Orocobre last financial year. There will be an
opportunity to ask questions on the report later, however I will
take this opportunity to make comment on a few specific points:
- The financial year was another year of significant progress for
our company and its flag ship Olaroz project. We achieved
production of just under 12,000 tonnes of lithium carbonate,
representing over 5% of the global market for lithium, and a maiden
operating profit of $19.4M after the
sale of some assets and impairments at Borax Argentina. The
company achieved this in an environment of growing demand for
lithium and consequently growing prices, factors that seem unlikely
to abate in the near term. Even in ramp up we had an
operating margin over 60% and we have established Olaroz as a
profitable producer.
- Share price performance was a roller coaster ride, primarily
because we downgraded production guidance in February 2017 due to problems with our pond
management. We know this damaged confidence in the
company and we have worked hard to restore that confidence.
Uninformed speculative commentary on pond design was neither
helpful nor accurate.
- In bringing Olaroz on-line management have achieved something
that has not been done for over 20 years. It is unique by the
inclusion of a purification circuit which can produce 100% battery
grade lithium on site. Our experience illustrates the
challenges of bringing new projects on line in an industry with
limited depth of skills and we believe these skills and knowledge
shortfalls will impact on supply growth in the short to medium
term. The experience gained by our team will be invaluable as
we look towards optimising current production and our future
expansion projects.
Growth and development
In conjunction with our joint venture partners we have continued
to investigate expansion of the Olaroz project and the construction
of a lithium hydroxide facility in Japan.
Your directors are convinced that the most value accretive
strategy we can pursue for our shareholders is to expand at Olaroz,
and through this take advantage of the buoyant market
conditions. We anticipate that as our operating performance
continues to improve we should be in a position to make a decision
in the first half of 2018 as long as we are confident phase 1
operating performance has been stabilised.
We have also progressed consideration of a lithium hydroxide
facility to be based in Japan. We will not operate this
facility, preferring to direct our management resources to Olaroz,
but I can assure you we will be an active investor and this will
provide access to a new product stream for our lithium carbonate
and mitigate risk as battery technologies develop. A decision on
this development is also expected early in the first half 2018.
Sustainability
Last year I advised that we intended to improve our reporting on
sustainability. Consistent with that commitment we will be
releasing our first Sustainability Report next week, focused solely
on the Olaroz project. The report is a major achievement
however, it is a consequence of Richard and his management team
making Shared Value the bed rock upon which the Olaroz project
would be developed almost 10 years ago. We take a long-term
view on the development of Olaroz since this is in the best
interests of all stakeholders and is the best way to deliver
returns to our shareholders.
The report, amongst other things, highlights the importance of
our local communities and their interest, not only in economic
development, but effective management of the entire basin. This
will require a coordinated approach between other basin
participants, the Jujuy Government and Orocobre. We are supportive
of a collaborative approach and will work with all interested
parties.
Remuneration
We have continued the approach to remuneration that was endorsed
by shareholders at the 2016 AGM. This has traditionally
reflected a market based approach, taking into account the unique
characteristics of Orocobre and the personal demands we make on our
senior management given the location of our assets and
international time differences. The form of our remuneration
report and quantum of remuneration appears to have been well
accepted by shareholders.
In 2018 we intend to make changes to the structure of our
incentives. The key change is the split between short term
cash incentive and long-term equity incentive will be altered to
favour the long-term incentive. This will see future
management remuneration being highly dependent upon share price
appreciation, ensuring greater alignment with our
shareholders. It should also assist in retaining our key
people as the skills we have nurtured become more valued by other
companies embarking on the same journey that we are
travelling.
The first example of this change is Resolution 4 which deals
with the allocation of 197,769 performance rights to Richard.
Richard's overall remuneration package has not changed, however the
split of incentive has broadly changed from a ratio of short term
to long term incentive of 50/50, to 15% short term and 85% long
term.
Board
The composition of the board has not changed during the
year. However, John Gibson who
assumed the role of Chair of the Audit Committee in July last year
has stood down from that role and Leanne
Heywood is the new Audit Committee Chair. The
composition of the Committee does not change. I would like to
express my appreciation to John for his contribution as Audit
Committee Chair in the last year.
Resolution 6 proposes an increase in the Directors' fee
pool. This will enable us to keep fees consistent with market
rates but more importantly provide the board with the flexibility
to make additional appointments to the board should new skills be
required.
Closing
In closing I would like to pass my appreciation to the
management team both here and in Argentina and my colleagues on the board for
their innovation and sheer hard work. I reserve my final
thanks to our shareholders for your patience and support on the
Orocobre journey.
For more information please contact:
Andrew Barber
Investor
Relations Manager
T: +61 7 3871 3985
M: +61 418 783 701
E: abarber@orocobre.com
About Orocobre Limited
Orocobre Limited (Orocobre) is
a dynamic global lithium carbonate supplier and an established
producer of boron.
Orocobre is dual listed on the Australia and Toronto Stock Exchanges (ASX:
ORE), (TSX: ORL). Orocobre's operations include its Olaroz Lithium
Facility in Northern Argentina,
Borax Argentina, an established Argentine boron minerals and
refined chemicals producer and a 35% interest in Advantage
Lithium.
For further information, please visit www.orocobre.com
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SOURCE Orocobre Limited