Tasmanian Senator Nick McKim has slammed Woolworths CEO Brad Banducci for refusing to answer his questions during a committee inquiry. Video by Aaron Smith (17/4/24)
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00:00 I'm going to put it to you that the average size of your equity base in that financial
00:06 year was north of $6.6 billion, which makes your return on equity in the last financial
00:14 year about 26%.
00:16 Would you agree with that?
00:18 Senator, the measure we use is return on investment.
00:20 Mr Banducci, please, I'm not interested in your spin here today.
00:23 I'm interested in you responding to the questions that you are being asked and I'm asking you
00:28 about return on equity, please.
00:30 Senator, with due respect, we look at return on investment, which is the key measure for
00:35 our business.
00:36 Mr Banducci, are you struggling with the ordinary English language meaning of the words that
00:38 I'm using in my questions?
00:39 I'm focusing on corporate finance, Senator, and that's what we use, which is return on
00:43 investment.
00:44 I am asking you about return on equity.
00:46 I'm not asking you about any other accepted measure of profitability.
00:52 I'm asking you about this particular accepted measure of profitability, which is return
00:57 on equity.
00:59 Would you dispute that your ROE in the last financial year was about 26%?
01:05 Senator, with respect, we look at return on funds employed.
01:10 I don't care what you look at, Mr Banducci.
01:13 You're not answering the question.
01:15 Please address yourself to the question.
01:17 Would you dispute that your return on equity in the last financial year, when you made
01:24 $7 billion in profit, was about 26%?
01:28 Would you dispute that?
01:30 You can focus on whatever you want to in your Woolworths board meetings, in your senior
01:36 executive team meetings.
01:38 You can focus on whatever you want to.
01:41 I put it to you, the reason you don't want to focus on return on equity is because you
01:47 don't like the story that it's telling, which is that you are basically profiteering and
01:53 making off with massive profits at the expense of farmers, at the expense of your workers,
01:59 and at the expense of Australian shoppers, who you are price gouging.
02:03 Why won't you answer a simple question about what your ROE is?
02:09 Senator, with due respect, we focus on return on investment.
02:14 I understand what you focus on, Mr Banducci.
02:17 I do understand that.
02:18 You've been very clear about that.
02:20 You can focus on whatever you like.
02:22 Isn't it the fact that you don't want to engage on return on equity because of the story that
02:28 it tells?
02:29 Senator, this is the number we focus on because this dollar investment, you need to get the
02:34 return out of it.
02:35 We look at the dollar of investment put into our business and the return.
02:40 That is wired into our incentive structures.
02:43 It is the right way for us to look at our business.
02:45 What is the investment you put in and what is the return you get out?
02:48 So it is cherry picking the data you want to talk about because it misleads Australians
02:54 about the profitability of your company.
02:56 That's the case, isn't it?
02:58 Senator, I think everyone hopefully understands return on investment.
03:01 What return do you get from a dollar you invest in a business?
03:04 I have put it to you, I don't know, I've lost count, maybe a dozen times.
03:09 Why won't you confirm for this committee what your return on equity was in the last financial?
03:16 I'm not interested in any of the other measures that you're talking about.
03:20 I'm happy to talk about them later.
03:22 Sure other committee members will have questions for you.
03:25 Why won't you confirm what your ROE was?
03:28 Why won't you do that for this committee?
03:31 You are sworn to tell the truth here, Mr Banducci, and I'm not interested in your spin.
03:36 I'm not interested in the other things that you focus on.
03:39 The committee will determine what the questions are.
03:41 Please answer the question about ROE.
03:43 Senator, with due respect, we focus on our return on investment.
03:49 I know what you focus on.
03:50 Thank you, Mr Banducci.
03:51 I know what you focus on.
03:53 You've been very clear about that.
03:54 Thank you.
03:55 Thank you.
03:56 Thank you.
03:56 [BLANK_AUDIO]