APM plunges to $219m loss, executive pay cut, as takeover looms

APM has crystallised a $219 million annual loss as it prepares to quit the ASX after three dismal years as a public company. The employment and disability services provider’s likely last financial results as a listed entity were weighed down by $269m of writedowns that swamped lower underlying earnings, punctuating a woeful past 12 months. The weak performance saw APM “defer” cash bonuses to its bosses, led by founder and executive chair Megan Wynne and chief executive Mike Anghie. Nonetheless, the latter still pocketed $2.82m for the horror year. While down from his $3.7m of remuneration for the earlier year, Mr Anghie received $615,825 in long-term bonuses in the form of shares linked to three-year performance targets. Ms Wynne’s remuneration fell $300,000 to $1.02m. APM has backed a $1.3 billion takeover by major shareholder Madison Deaborn that will see the under-pressure group bought out at only $1.45 a share — $2.10 short of its float issue price in November 2021. The takeover scheme will go to a shareholder vote next month. Friday’s annual financial results were largely consistent with disclosures in scheme documents recently sent to APM shareholders. The writedowns on goodwill and customer contracts inherited during APM’s acquisition spree were at the bottom end of a range of $250m to $350m previously disclosed by the group. Having made a $108.7m bottomline profit the previous financial year, APM confirmed on Friday that underlying earnings slumped 47 per cent to $95.1m in the 12 months to June 30, despite a 21 per cent jump in revenue to $2.3b. Madison Dearborn, which helped float APM and holds 29 per cent of the group, lobbed the lowball offer after rival private equity group CVC walked away from an improved $2-a-share proposal in April. The thinly-traded APM lost the support of shareholders with a series of profit downgrades from October that stunned investors and sent its share price plunging to as low as 68¢ in January. While it was winning more contracts and growing revenue at a fast clip with acquisitions, the group’s employment services business was hammered by strong job markets that reduced demand for its services. A high debt load also undermined sentiment. “While there are early signs of stabilisation in unemployment data and caseloads in employment programs, the environment remains subdued,” Mr Anghie said on Friday. APM noted the group’s uncertain outlook in endorsing the Madison Dearborn bid in July. Ms Wynne, who together with husband Bruce Bellinge controls 34 per cent of the company, and Mr Anghie have recommended acceptance of the cash or scrip offer. Mr Anghie owns 21.9m APM shares. On a conference call with analysts on Friday that did not elicit a single question, Ms Wynne thanked “valued shareholders for your willingness to invest in a company dedicated to creating sustainable social impact”. APM shares were flat at $1.435 as at midday.