AGM alert: Frasers, Babcock, Auto Trader

A £100 million payday for the boss of Frasers Group (LSE:FRAS) is to be tied to a lower share price after the retailer announced changes to the bonus scheme ahead of its AGM this month.

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The scheme has been reset for the period to 2030, with chief executive Michael Murray and three other executives required to meet a lower share price hurdle of £12.

The current scheme, which runs until next month, will not pay out after the company delivered the required £500 million of adjusted profit but not a share price of £15. The highest level achieved by FTSE 250-listed Frasers in the last five years has been 949p.

Babcock International Group (LSE:BAB) is also seeking AGM approval for a proposal that will see a Total Shareholder Return ‘kicker’ element added to its long-term incentive scheme.

Frasers Group

When: 9am, Wednesday 24 September.

Where: Unit D, Brook Park East, Shirebrook, NG20 8RY.

How to participate: Proxy voting forms need to be returned no later than 9am, Monday 22 September. More AGM details can be found here.

Who’s in the chair? Former Nike director David Daly, who was appointed to the board in 2017, is stepping down after the AGM. He will be succeeded by Jon Thompson, the ex-chief executive of the Financial Reporting Council and HMRC who joined the Frasers board last summer.

How did the company do in the year to 27 April? Retail revenues fell by 7.4% to £4.75 billion, with continued sales growth from Sports Direct more than offset by planned declines in areas including Game UK and Studio Retail. Adjusted pre-tax profit of £560.2 million rose 2.8% despite the non-recurrence of a £25 million gain from a disposal in 2024. Adjusted earnings per share of 98.1p lifted 2.4% on a year earlier. The company did not declare a dividend.

How have shares performed? Down 20% to 655p (687p on Thursday).

How much is the boss paid? Michael Murray, who was appointed in May 2022, has waived his £1 million salary for three consecutive financial years. He will do so again in the current period.

What’s happening with the Executive Share Scheme? The four-year performance period expires on 7 October. The 6.7 million shares awarded to Murray under the scheme would have netted him £100 million in the event that the share price traded above £15 for at least 30 consecutive days and the company met an adjusted profit target of £500 million. The profit element has been achieved but not the share price hurdle.

How is the scheme changing? Its operation has been extended to 30 September 2030, with a lower price target of £12. This reverts to the level used prior to an upward adjustment to £15 at the 2022 AGM. For the chief executive, an increase in the number of shares means his reward potential is maintained at the same level of £100 million. Resolution 21 seeks approval for the changes, which are outlined from page 22 onwards in the Notice of AGM document.

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What’s the company say? The remuneration committee considered alternative incentive structures for its four-strong executive team but concluded that “our successful and entrepreneurial business culture” was better supported by the scheme. It points out that £12 is above the highest share price attained by Frasers in the last five years (949p), making it an “appropriate but realistic stretch” for the executive share scheme.

How did last year’s AGM go? The new three-year remuneration policy was approved with 92.88% of votes in favour. The annual remuneration report got 99.52% support.

How’s the company doing on diversity? Four female directors accounted for 40% of board roles at the end of the financial year, although not in senior positions. The company met the Parker Review requirement to have at least one director from an ethnic minority background.

Babcock International

When: 11am, Thursday, 25 September.

Where: Ashurst LLP, Fruit & Wool Exchange, 1 Duval Square, London E1 6PW.

How to participate: Proxy voting instructions should be returned no later than 11am, Tuesday 23 September. More AGM details can be found here.

Who’s in the chair? Ruth Cairnie, who spent four decades at the oil giant Shell, was appointed in July 2019. She is a former board director of Rolls-Royce and Associated British Foods.

How did the company do in the year to 31 March? Revenues grew organically by 11% 

to £4.8 billion, driven by particularly strong growth in Nuclear and Marine. Underlying operating profit lifted 53% to £363 million, or by 17% when excluding 2024’s non-recurring items. An operating margin of 7.5% represented a 50-basis points improvement, highlighting progress towards medium-term guidance of at least 8%. A final dividend of 4.5p a share is due to be paid on 30 September, lifting the total for the year by 30% to 6.5p a share.

How have shares performed? Up 39% to 724p (1,068p on Thursday).

How much is the boss paid? David Lockwood’s salary has been increased by 3% to £932,933, which is on top of the previous year’s 11% rise. His total remuneration for 2024/25 amounted to £5.4 million, which included £1.3 million of cash and deferred shares after the annual bonus scheme made the maximum award. The 100% vesting of long-term incentives granted in August 2022 contributed £2.9 million to the overall figure.

How was variable pay determined? Underlying financial performance measures comprised 80% of the bonus, split equally between operating cash flow and operating profit. Babcock’s three-year performance for underlying free cash flow and relative total shareholder return accounted for the vesting of long-term incentives.

Why is the remuneration policy being updated a year early? The remuneration committee launched a review in early 2025 as it wanted to do more to support the board in addressing the perceived gap between valuation and actual share price. Its policy changes sought to reinforce the confidence that the board has in prospects, without diluting focus on sustainable growth and margin expansion. A strong recent performance has since closed the valuation gap to its nearest FTSE comparators, but the committee believes the proposals remain appropriate.

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What’s changing? The remuneration committee is planning to apply an absolute Total Shareholder Return (TSR) ‘kicker’ element to vested long-term performance share plan awards. The maximum multiplier of two times would require absolute TSR to be at least 30% per annum. This doubles the maximum long-term opportunity in the new remuneration policy to 500% of salary, from 250% currently. At 10% per annum absolute TSR,  there would be no increase in value beyond that earned under the core PSP award. The annual bonus opportunity is increasing from 150% to 180% of salary in order to ensure competitiveness with companies of similar size and in Babcock’s market.

What’s the impact of the changes? The company’s modelling suggests that the proposals would increase overall target pay for executive directors by about 19%, bringing it to around the upper quartile of sector peers. Based on the company’s closing market capitalisation on 31 March, full vesting of the TSR kicker opportunity would represent about £4.4 billion of shareholder value created over the three-year period. The remuneration committee said: “We are convinced that these changes will help drive an enhanced focus on shareholder returns.”

How did last year’s AGM go? The annual remuneration report was approved with 97.11% of votes in favour. The 2023 remuneration policy resolution got 98.29% support.

How’s the company doing on diversity? The board has at least 40% female representation, including one senior role. At least one board member is from an ethnic minority background.

Auto Trader

When: 11am, Thursday 18 September.

Where: 4th Floor, 1 Tony Wilson Place, Manchester, M15 4FN.

How to participate: Proxy voting instructions should be returned no later than 11am, Tuesday 16 September. More details about Auto Trader Group (LSE:AUTO)'s AGM can be found here.

Who’s in the chair? Matt Davies, who is the former chief executive of Pets at Home, Halfords and Tesco UK, was appointed to the role following the 2023 AGM.

How did the company do in the year to 31 March? Revenues grew 5% to £601.1 million and operating profit increased by 8% to £376.8 million, with an operating profit margin of 63% up from 61% in 2024. Adjusted earnings per share increased by 8% to 31.66p. A dividend of 7.1p a share is due to be paid on 26 September, increasing the total for the year by 10.4% to 10.6p.

How have shares performed? Up 6% to 744.2p (794.6p on Thursday).

How much is the boss paid? Nathan Coe’s base salary for 2025/26 is up 3.5% to £714,000, having increased 11.7% the previous year.. His total for 2024/25 amounted to £2.35 million, down from £3.2 million the year before. The figure included £452,000 of cash and deferred shares after the annual bonus scheme paid 43% of the maximum opportunity. The 74.3% vesting of long-term incentives contributed £1.2 million to the overall figure.

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How was variable pay determined? The annual bonus is primarily based on group operating profit, which at £376.8 million resulted in a pay-out of 28% out of a maximum of 75% for this element. Progress made on the company's digital retailing strategic priority scored 15% out of a maximum 25%. For the long-term performance share plan, operating profit growth of 9.2% and revenue growth of 9.7% over the three-year period were slightly below the set stretch targets.

How did last year’s AGM go? The new three-year remuneration policy, which included changes in order to make incentive opportunities more competitive, was approved with 95.88% of votes in favour.  The annual remuneration report got 95.77% support.

How’s the company doing on diversity? Board composition after the AGM will be six women and three men, with one female director in a senior role. Two board members are from an ethnically diverse background.