Endeavour Group’s Chairman responds to primary shareholder Bruce Mathieson Snr

September 29, 2023
By Melissa Parker

In response to primary shareholder Bruce Mathieson Snr’s public concerns regarding EDG’s performance, Chairman Peter Hearl has penned a letter addressing these concerns. Within the letter, Hearl contends that any assessment of EDG’s business performance over the past four years unequivocally positions the company as the foremost market leader in its respective categories. He asserts that suggesting otherwise would reflect a fundamental misunderstanding of Endeavour Group’s accomplishments.

Hearl expresses disappointment that Mathieson’s communication, both privately and publicly, fails to provide a well-rounded or accurate portrayal of the business. He argues that such misrepresentations only serve to misinform shareholders and exert a negative influence on the company, thereby disadvantaging all stakeholders.

In terms of financial performance, Hearl highlights that Endeavour Group’s Retail business has achieved a compounded annual sales growth rate (CAGR) of 4.0% during the last four years (F19-23), while the Hotels business has recorded a sales CAGR of 4.8% over the same duration. He emphasizes that the Retail business has witnessed a substantial $1.5 billion increase in sales since F19, nearly tripling the growth of its closest competitor. Furthermore, he notes that EBIT growth has outpaced sales growth during this period, thanks to the success of the customer-centric strategy.

Hearl attributes this market-leading performance to the strength of Dan Murphy’s Lowest Liquor Price Guarantee and the prosperous membership program, MyDan’s. He further underscores the significance of MyDan’s, citing its 5.2 million active members and an industry-leading scan rate of 79%. The program’s efficacy is underscored by the fact that MyDan’s members’ basket sizes are more than twice the size of those of non-member shoppers.

Hearl also points out Mathieson’s prior acknowledgment of regulatory concerns negatively impacting the share price. He expresses disappointment that, in recent correspondence and public statements, Mathieson appears to overlook the potential consequences of regulatory changes on both the business and the share price. Hearl suggests that this omission may be driven by a subjective narrative surrounding the Board and management team’s performance.

In conclusion, Hearl’s response underscores EDG’s robust market performance, strategic initiatives, and commitment to shareholder value, while also addressing Mathieson’s concerns and highlighting potential oversights in his assessments.

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