The saga continues: 4 WiseTech directors quit en masse due to disagreements with Richard White

4 WiseTech directors quit en masse this morning, and that was just the start of the bad news facing the company this morning just 2 days before it is due to release its annual results.

A recap of the WiseTech saga

Before we outline what happened today, let’s bring investors up to speed to help newcomers better understand.

WiseTech founder and ex-CEO Richard White resigned in October only a few days after allegations of inappropriate conduct which we will not repeat here.

When the company announced his departure, it revealed that after a short period of leave, White would return as a consultant for the same $1m salary he was receiving before and on a 10-year term. CFO Andrew Cartledge, who planned to stand down at the end of CY25, would stand up to the role on an interim basis.

White will always be a part of the story having founded the company in 1994, led it privately until its ASX listing in 2016 and guided it to an extensive period of global growth.

WiseTech’s product CargoWise One, a Cloud-based end-to-end logistics execution platform that freight forwarders and other logistics companies can use to manage their businesses. The product is sold in a subscription model and is customisable to meet customer needs.

WiseTech is truly a global company with less than a third of its revenues coming from Australia and its 17,000 customers hailing from 150 countries. These include all of the Top 5 Global Freight Forwarders and 45 of the Top 50 Global Third-Party Logistics Providers (3PLs).

What happened? Why did 4 WiseTech directors quit en masse

The company released an announcement that four of the five directors on the board (including its chairman) were resigning. Departing were Lisa Brock, Richard Dammery, Michael Malone and Fiona Pak-Poy. Purportedly they ‘have determined it is in the best interests of the company to stand aside’.

How did they determine this? ‘This followed intractable differences in the Board and differing views around the ongoing role of the Founder and Founding CEO, Richard White’. Implicitly, they were not so keen on him coming back as a $1m-per year consultant.

The company is due to release half-yearly results on Wednesday and their resignation will take place once they signed off on the results. The results will be given by none other than Mr White himself, along with interim CEO and CFO Andrew Cartledge and Carline Pham. Joining the board is Mike Gregg from investor Shearwater Capital and remaining is co-founder Maree Gregg and Charles Gibbon (also from Shearwater).

Don’t hedge your bets on any ‘intractable differences’ on Richard White’s role to emerge from the new board any time soon, even with additional directors proposed to be added. We don’t imagine the company will agree to let anyone join the board who does not agree with the company’s plans for Richard White’s future with it.

Adding insult to injury

WiseTech told investors that it expects revenue to be at the bottom end of its guidance range, due to further delays to the rollout of its Breakthrough Products. Its EBITDA, granted, would be towards the top of the previously announced range due to an efficiency program.

The company told investors in November to expect for the full year $1.2-1.3bn in revenue (up 15-25%) and EBITDA of $600-660m (representing 21-33% growth and a 50-51% margin).

Bottom line

If there’s any positive, there’s a bit more certainty now that there’ll be a board that will be in 100%-concord that Richard White should be there. If WiseTech investors disagree he should be there, we don’t imagine there is much they can do about it other than do what the directors did.

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