“…I also need to say a few words about the unfortunate proxy battle which was initiated by a dissident shareholder, a shareholder of less than two months.
First, these are activists, not investors, in the sense of creating long-term value for our shareholders. We believe they are attempting to opportunistically gain significant influence over the Company at the expense of a strategy laid out by our Board, for the best interests of our long-term shareholders. While we are unsure of their intentions, the fact that they did not disclose their investment in Taseko’s bonds, an investment nearly three times larger than their stock investment, should be a serious concern to our shareholders.
They have created arguments of convenience around the service agreement we have with Hunter Dickinson. These services have amounted to approximately 1% of our total operating costs since 2012 and they have assisted Taseko in advancing our growth projects and creating long-term value. The Company receives exceptional value from Hunter Dickinson and the Board has very stringent guidelines and policies on how the Company deals with the related party aspect of the business relationship. The Services Agreement with Hunter Dickinson has been filed on Sedar since 2010, available for anyone to see. There is complete transparency, unlike the dissidents.
For example, Taseko operating costs from 2012-2015 were over $900 million. Fees paid to Hunter Dickinson during the same period were $12 million – for services such as; geological services on our Gibraltar and Aley drilling programs, engineering, finance and tax support (which resulted in a $27 million tax rebate in 2015), legal, SOX auditing (which saved the company over $100,000) as well as other flow through costs such as rent and Director fees. These costs have resulted in significant savings for the Company, contrary to the assertions of RRC.
The dissidents have also questioned Taseko’s corporate governance practices. We strive to ensure best practices are followed and continually look for opportunities to improve in this area, as with every other area in the Company. Over the past number of years, we have made a number of changes to strengthen or corporate governance, including changing the composition of our Board to be more independent and with a broader range of skill sets.
The present Board has 5 independent directors out of 8.
While this conference call is about our earnings I need to add, we are preparing a detailed Management Information Circular which will address RRC comments that we believe shareholders will need to know before voting.
This is a complicated matter so I am sure you all appreciate I can’t be giving superficial responses on a call like this. Everyone has to be patient until the circular comes out in a few weeks with all of the particulars.
I know it has been a challenging and frustrating five years for our shareholder base. As a large shareholder myself, I completely understand. Our strategic plan for creating long-term shareholder returns has been somewhat delayed due to the prolonged economic downturn, but we still strongly believe it is the right strategic plan and going forward it will pay off….”