AGM alert: M&S, Sainsbury’s, JD Sports

Stuart Machin’s £7.1 million pay package for leading the revival of Marks & Spencer Group (LSE:MKS) will be in the spotlight when the retailer hosts shareholders for another digital-first AGM.

More than 1,800 people engaged with 2024’s broadcast from the company’s support centre, compared with 593 shareholders in attendance in person at the 2019 AGM.

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Machin’s remuneration, which covered the period before cyber attack disruption, included an annual bonus of £1.6 million as well as £4.6 million from the vesting and increased value of long-term incentives granted three years previously.

Marks & Spencer

When: 11am, Tuesday 1 July.

Where: From the broadcast venue at M&S’s Waterside House Support Centre. This will be another digital-first event hosted by the radio and television presenter and journalist Anita Anand. It will also be possible to attend the meeting in person. Since adopting a digital approach, M&S said engagement levels for the AGM have increased by 200% and saved the business on average £200,000 compared to the cost of the 2019 meeting. In 2009, the company had 1,466 shareholders in attendance while the digital-first, hybrid format of the 2024 meeting was attended in person by 40 shareholders and 1,806 digitally.

How to participate: The deadline to vote online and pre-submit questions in advance of the AGM is 11am, Friday 27 June. More AGM details can be found here.

Who’s in the chair? Archie Norman, who was appointed in 2017, has overseen the transformation of a number of major British businesses including Kingfisher and Asda.

How did the company do in the year to 29 March? The retailer delivered a third consecutive year of growth in sales and market share, profit and improving return on capital. Group sales lifted 6.1% to £13.9 billion, with food up 8.7% to £9 billion and the fashion, home and beauty division 3.5% higher at £4.2 billion. Operating profit of £984.5 million rose 17.4%, driven by a 25% improvement in food alongside an 8.6% advance in fashion. Profit before tax aad adjusting items lifted 22.2% to £875.5 million and earnings per share by 29.7% to 31.9p. The total dividend for the year rose 20% to 3.6p a share, an outlay of £73.7 million which includes plans to pay 2.6p a share on 4 July. The company expects the interim dividend for 2025-26 will be one third of the prior year total.

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What about the cyber attack? In the annual report, chair Archie Norman said the impact of the incident, which took place after the financial year-end, was expected to endure for “some weeks, or even months”. However, he said he remained confident that M&S will recover the “formidable momentum” in trading performance seen in 2024/25 and bounce back better and stronger. He added: “The business world today rarely moves in straight lines and just as you think life has become more predictable, events have a way of upending the best performing team and bringing us all back to the ground.” The most recent estimate of the incident’s financial impact is £300 million for the 2025/26 financial year, prior to any mitigating actions.

How have shares performed? Up 34% to 354.6p (370.8p on Thursday).The company has 111,950 shareholders, including about 60,000 with 500 or fewer shares.

How much is the boss paid? Stuart Machin’s total remuneration amounted to £7.1 million, up from £5.1 million the previous year and the largest sum paid for the role in the past decade. The annual bonus scheme delivered cash and deferred shares worth £1.6 million based on 97% of the maximum opportunity. The 90% vesting of long-term incentives contributed £4.6 million, with the increase in share price from the grant date in July 2022 accounting for £2.7 million of total pay. Machin’s annual salary is due to increase on 1 July by 2% to £865,700.

How was variable pay determined? The annual bonus award was 70% based on pre-tax profit, which at £875.5 million came in above the stretch target of £842 million. The rest was assessed on individual performance against the delivery of the transformation plan. The vesting of long-term incentives was based 80% on the company’s three-year performance for adjusted earnings and return on capital employed and its upper quartile ranking for total shareholder return. Among the strategic aspects, the target for M&S.com growth was not met. The remuneration committee made no adjustments as a result of the cyber attack but will revisit the matter in the context of the 2025/26 remuneration outcomes. As a result of the incident, the committee has delayed setting the targets for the 2025 long-term incentives awards granted at 250% of salary in July. These will be disclosed before the end of the year.

What about staff remuneration? The strong share price performance over the last three years benefited the 3,400 members of the company’s 2021 ShareSave scheme, which matured in February with an average gain of £2,216. From April, the pay rate for M&S customer assistants increased by 5% to £12.60 nationally, and £13.85 in London. M&S said this is in line with the Real Living Wage and represents an investment of £95 million.

What’s in the special resolution? A group of shareholders coordinated by ShareAction has tabled a resolution requesting detailed data disclosures relating to staff pay and the pay of third-party contractors.The move is part of a wider campaign by ShareAction as it calls for more transparency on just how many staff are not being paid a real Living Wage and for businesses to explain why they can’t pay staff a wage that reflects the true cost of living. M&S points out that it has increased standard hourly pay by over 26%, at a rate more than double inflation since 2022. It added: “The board does not believe it is necessary to report beyond our current disclosures which are already fulsome in their nature.”

Why is the limit for non-executive director fees changing? AGM resolution 26 proposes an increase in the maximum aggregate fees that can be paid to non-executive directors each year, from £750,000 to £2 million. The limit of £750,000 has not been increased since it was introduced in 2006. M&S says the move will provide flexibility to increase the board size and to recruit and retain suitable board candidates in the future. For this year non-executive director fees have increased by 3% to £81,276, bringing the total aggregate figure to £695,564.

How did last year’s AGM go? The annual remuneration report was approved with 95.26% of votes in favour. 

How’s the company doing on diversity? The gender split of the ten-strong board is 60% female, including in the roles of chief financial officer and senior independent director. One board member identifies as being from an ethnic minority background.

Sainsbury’s

When: 11am, Thursday 3 July.

Where: Leonardo Royal Hotel London St Paul’s, 10 Godliman Street, London, EC4V 5AJ. 

How to participate:  The meeting will be broadcast live so Sainsbury (J) (LSE:SBRY) shareholders can attend and participate virtually or in person. Proxy voting instructions should be returned no later than 11am, Tuesday 1 July. More AGM details can be found here.

Who’s in the chair? Former Deloitte partner Martin Scicluna, who previously chaired the boards of RSA Insurance and Great Portland Estates, joined as a non-executive director in 2018 and took on the role of chair in March 2019.

How did the company do in the year to 1 March? Supermarket sales excluding fuel rose 4.2% to £26.6 billion, while Argos fell 2.7% to £4.9 billion. Retail underlying operating profit of £1.04 billion lifted 7.2%, with double-digit growth at Sainsbury’s partially offset by lower profits at Argos. Underlying pre-tax profit rose 8.6% to £761 million, while retail cash flow of £531 million was in line with the guidance of at least £500 million. The full-year dividend rose 4% to 13.6p a share, including plans to pay 9.7p a share on 11 July.

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How have shares performed? Up 4% to 258.6p (283.8p on Thursday).

How much is the boss paid? Simon Roberts’ total remuneration for 2024/25 amounted to £5.2 million, up from £4.8 million the year before and in line with the 2022/23 outturn. This year’s  figure included an annual bonus of cash and deferred shares worth £1.95 million, which was 91% of the maximum. The 72.5% vesting of long-term incentives contributed £4.1 million to the overall figure. His basic salary for this year has increased by 3% to £1 million.

How was variable pay determined? Profit accounts for half the annual bonus, with a figure of £761 million above the stretch target of £750 million. Strategic objectives and retail free cash flow made up the rest of the bonus scorecard. For long-term incentives, there was maximum vesting under retail free cash flow with return on capital between target and stretch and both earnings per share and cost reduction part way through the range.

How did last year’s AGM go? The annual remuneration report was approved with 98.60% of votes in favour.

How’s the company doing on diversity? Female representation on the board was 44%, including in one senior role. The level is due to increase to 50% with effect from the conclusion of the AGM. One member of the board is from an ethnic minority background.

JD Sports Fashion

When: 10am, Wednesday 2 July.

Where: Addleshaw Goddard LLP, One St. Peter’s Square, Manchester, M2 3DE.

How to participate:JD Sports Fashion (LSE:JD.) shareholders wishing to receive a response to a question in advance of the proxy voting deadline of 10am, Monday 30 June should submit their questions by email no later than 10am, Thursday 26 June. More AGM details can be found here.

Who’s in the chair? Andrew Higginson, who was appointed in 2022, previously held senior leadership roles at Tesco over a period of 15 years and was chair of Morrisons from January 2015 until its private equity takeover in November 2021.

How did the company do in the year to 1 February? Revenues of £11.5 billion were 10.2% higher against the comparative 52-week period. In a volatile market, like-for-like growth of 0.3% and a 5.5% benefit from new stores led to organic sales growth of 5.8%. Pre-tax profit before adjusting items fell 4% to £923 million as a result of higher operating costs. During the year, the company spent £1.4 billion on the acquisitions of Hibbett and Courir, including repayment of debt. The total dividend rose 11% to 1p, including the proposed payment of 0.67p on 11 July. 

How have shares performed? Down 24% to 89.1p (77.3p on Thursday).

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How much is the boss paid? Régis Schultz got a total of £2.04 million for 2024/25, up from £1.6 million the year before. The figure included an annual bonus of £824,235 in cash and deferred shares, which was based on 38.5% of the maximum. His 2022/23 long-term incentive award lapsed in full after the pre-tax profit threshold of £994.5 million was not achieved. His base salary for 2025-26 has increased by 3% to £1.1 million.

How was the annual bonus determined? Net cash flow and the measure used to track customer loyalty and satisfaction achieved the maximum result, accounting for 15 and 10 percentage points respectively of the 38.5% result. There was nothing in relation to the 50% of the scheme weighted to pre-tax profit.

What’s in the new remuneration policy? The policy approved at the 2022 AGM with 99.22% support focused on aligning JD with FTSE 100 market best practice after a run of governance issues. The main change in the proposed new policy concerns the long-term incentive plan, where the overall maximum opportunity will increase from 200% of salary to 300%. This is split 250% under the existing Performance Share Plan, which is determined against metrics including free cash flow and incentivising further growth in the US following the acquisition of Hibbett. The remaining 50% will be a Restricted Stock Plan, with vesting based on the assessment of the remuneration committee of factors including profit performance relative to market expectations and shareholder returns over the three-year period.

Why the changes? Recent acquisitions, including US-based Hibbett, have created an  inconsistency in remuneration across the business. Whilst some executives have a long-term incentive plan consisting of a mixture of performance and restricted share awards, the group’s executive directors remain under the current policy using a standard UK performance share plan. It adds that the changes will mean closer alignment with key performance metrics, including free cash flow. Under the new remuneration policy, Schultz is in line to receive a maximum £6.8 million or £8.4 million in the event of 50% share price appreciation. JD said the proposal narrows the gap between JD’s remuneration and US peers and positions it appropriately when compared to UK and EU retailers of a comparable size. 

How did last year’s AGM go? The annual remuneration report was approved with 98.63% of votes in favour.

How’s the company doing on diversity? The 11-strong board has four women, including one director in a senior role. At 36.36%, the gender split is below the recommended 40% following the departure of two directors. One board member is from an ethnic minority background.