Hyflux’s ex-communications head says she was not told to hide information in shareholder engagements

[SINGAPORE] The former head of corporate communications and investor relations at Hyflux who took the stand on Wednesday (Aug 20) said she was not told to hide any information from the investing public in engagement events.

Winnifred Heap, under cross-examination by Senior Counsel Davinder Singh, said it was the standard and the norm in Hyflux to be upfront, and to maintain integrity in the information provided in presentations and her answers to questions from the investing public.

She was on the stand on Day 5 of the hearing against a group of Hyflux’s senior executives on whose watch the now-defunct company allegedly withheld material information on the Tuaspring project to the Singapore Exchange. They are contesting the charges related to the alleged failure to disclose the information.

Hyflux is alleged, for instance, to have failed to say that it was entering the power-generation business for the first time, and that the Tuaspring project would draw the bulk of its top line from the sale of electricity.

Singh is representing Olivia Lum, the founder of the water-treatment company and its former chief executive. Also facing one or more charges are the company’s former chief financial officer Cho Wee Peng and four independent directors Teo Kiang Kok, Gay Chee Cheong, Christopher Murugasu and Lee Joo Hai.

During her testimony, Heap was referred to Hyflux’s investor relations plan, under which she arranged for international roadshows for Lum to meet shareholders. She said she also went for conferences organised by various securities houses.

While she could not recall whether the roadshows took place, she agreed with Singh that she was not instructed to hide any facts from stakeholders at these events.

“In fact you wouldn’t agree even if you were told to do so?” asked Singh. “Yes,” she responded, and made the point that it was the standard and norm to be upfront about the information.

She also concurred that the risk management committee’s positioning of Hyflux as a growth company – by disclosing the new orders that Hyflux had received – was done in good faith and in the interests of shareholders and stakeholders.

Heap was also taken through presentations she had made on the feedback from the investing community, and her recommendations for investor relations; Singh pointed out that the board and the management were relying on her material.

Singh suggested that one of her recommendations had been to emphasise Hyflux’s organic growth into an integrated water-solutions provider and its core competitive advantages, as a way to address shareholders’ concerns that Hyflux had been re-rated from being a growth company to a utility player. She agreed with his interpretation.

He also got her to agree that it was important for everyone in Hyflux to be “on the same page” to ensure consistency in the messaging to the market. He also highlighted to her that her investor relations plan for Hyflux in 2011 had listed “desalination and wastewater recycling” as the key segments.

Singh cited the draft for the Mar 7, 2011 announcement of Hyflux being named the preferred bidder for the Tuaspring project, and accused her of failing to check with her then-colleague Camille Hurn – the senior vice-president of energy and infrastructure development – about the edits made to the draft.

Hurn had not been sure if it was necessary to go into detail about Hyflux’s energy-retailing arm, so had deleted that sentence.

Singh said to Heap: “Here was a senior-management person raising a concern which possibly could have been related to utilities and the IR (investor relations) strategy, (and yet) you did nothing to try and understand?”

Heap answered: “As far as I can remember, yes.” She will continue to be cross-examined on Thursday.