Interactive Investor

Your vote counts: ASOS, Ferguson, Bellway

26th November 2021 08:10

Graeme Evans from interactive investor

It’s a final AGM in the UK for one of these companies and the first for a new chairman. Will it be a fond farewell and ticker-tape welcome, or will they be chased out of town? 

The ending of an era at plumbing supplier Ferguson (LSE:FERG) and new leadership at fast fashion chain ASOS (LSE:ASC) should bring added interest to their respective AGMs in the coming days.

Ferguson's AGM may be its last on these shores after the company formerly known as Wolseley announced plans to switch its primary listing to the US. The group, which listed on the London Stock Exchange in 1986, now generates all its revenues in North America.

The ASOS meeting will be the first for chairman Ian Dyson, who is due to replace Adam Crozier on Sunday. Mat Dunn is also the interim CEO after October's departure of Nick Beighton.

Ferguson

When: 12.30, Thursday 2 December

Where: Freshfields Bruckhaus Deringer, 100 Bishopsgate, London, EC2P 2SR 

How to participate: The FTSE 100-listed plumbing and heating supplies company says it looks forward to welcoming shareholders in person at this year's AGM. It is using the InvestorVote service, with a deadline of 12.30pm on 30 November for votes either made electronically or via a proxy form. More details on the AGM can be found here

Who is in the chair? Geoff Drabble, who was boss of FTSE 100-listed equipment rental firm Ashtead for 12 years.

How did the company do in the year to 31 July? Revenues rose 14.3% to $22.8 billion (£17 billion) and profits lifted 46.4% to $1.89 billion (£1.4 billion). Operations are now entirely focused on North America after January's disposal of Wolseley in the UK, a move which led to the payment of a $410 million (£305 million) special dividend in May. A final dividend of 166.5 cents a share is being paid on 10 December, while shareholders are due to vote next spring on whether to switch the company's primary listing to the US market.

How much is the boss paid? Kevin Murphy, who was appointed chief executive in November 2019, received a 3% pay rise in October to take his base salary to $1.2 million (£894,000). His total remuneration for 2020/21 came to $7.7 million (£5.7 million) after he was awarded the maximum bonus opportunity worth $1.7 million (£1.3 million) and received $4.6 million (£3.4 million) from the vesting of shares in the company's long-term incentive scheme.

How did last year's AGM go? The advisory vote on the remuneration report was carried with 78.15% of votes in favour. Feedback found unhappiness at headcount reductions during 2019/20 not being part of bonus determinations. The dissent prompted Ferguson to improve transparency around its remuneration decision-making. Further changes made in response to the meeting included an increase in the CEO's shareholding requirement to five times salary and a post-employment shares requirement in line with standard FTSE 100 practice. 

What's the view of voting agencies? Glass Lewis believes shareholders can be satisfied with the company's response to last year's AGM. It notes the salary increase of 9.3% awarded to chief financial officer Bill Brundage from October, but says this does not warrant shareholder action as it stems from Ferguson's increased scope and complexity, particularly since its US listing.

How is the company doing on diversity targets? Ferguson still has “work to do” in improving its pipeline for female talent in senior executive positions, but at board level it continues to satisfy the gender diversity recommendations of the Hampton-Alexander review. Since May, it has been in compliance with the Parker review advice that FTSE 100 boards should have at least one director from an ethnic minority background.

Bellway

When: 8.30am, Monday 6 December

Where: Woolsington House, Woolsington, Newcastle Upon Tyne, NE13 8BF

How to participate: Proxy voting instructions must be received at least 48 hours before the meeting, which is open for shareholders to attend. More details on the AGM can be found here.

Who is in the chair? Paul Hampden Smith, former finance director of Travis Perkins.

How did the company do in the year to 31 July? The number of housing completions rose by 34.8% to 10,138 as Bellway (LSE:BWY) revenues lifted 40.3% to £3.1 billion and earnings per share doubled to 316.9p. A final dividend of 82.5p a share is due to be paid on 12 January, representing a 65% jump on last year but lower than the 100p seen in 2019. It is targeting profits of around £1.25 billion over the next two financial years, with one-third of the after-tax amount being returned to shareholders in dividend payments.

How much is the boss paid? Jason Honeyman, who joined Bellway in 2005 and became chief executive in August 2018, received just over £2 million in the financial year. This includes his maximum bonus opportunity of £822,804 and the vesting of long-term incentives worth £317,670. He invested part of his bonus in Bellway shares, which he will keep for at last three years. His salary for this year has risen in line with the workforce by 3.2% to £711,048.

What changes have been made to the remuneration policy? The new three-year policy, which requires the support of shareholders at the AGM, introduces the mandatory deferral into Bellway shares for three years of any bonus earned above 100% of salary. There's also a post-exit shareholding requirement of two years and an increase in the long-term incentive scheme to 200% of salary, although this will not apply for the year ahead.

How did last year's AGM go? The remuneration report was carried with 99.47% support, while the remuneration policy was passed with 95.69% after minimal changes were made prior to a full review this year.

What's the view of voting agencies? Glass Lewis recommends shareholders vote in favour of the remuneration report and the binding resolution on the remuneration policy. 

How is the company doing on diversity targets? Women continue to account for a third of board roles. Bellway is actively working to identify a candidate pool for future board appointments to bring it in line with the Parker review on ethnic minority representation.

ASOS

When: 12 noon, Tuesday 7 December

Where: Greater London House, Hampstead Road, London NW1 7FB

How to participate: Shareholders will be able to attend in person but are encouraged to take a lateral flow test beforehand. The event will be more streamlined than previous meetings and the company will not be serving refreshments. Those wishing to vote on the resolutions should appoint a proxy electronically by no later than 12 noon on Friday 3 December. More details on the AGM can be found here.

Who is in the chair? Former Punch Taverns CEO and M&S finance director Ian Dyson, who on Sunday takes on the role previously held by Adam Crozier.

How did the company do in the year to 31 August? Sales growth of 22% to £3.9 billion was driven by an “exceptional” performance in the UK. Adjusted profits were 36% higher at £193.6 million but this was aided by an estimated Covid-19 related benefit of £67.3 million. The gross margin was down by two percentage points to 45.4%, driven by elevated freight and Brexit-related duty costs.

How much is the boss paid? Nick Beighton, whose six years as chief executive ended in October, received a base salary of £608,250 after a 6.5% pay rise last December. A bonus of £819,921 and long-term incentive awards took his total to £1.9 million. Chief financial officer Mat Dunn, who is now interim boss, got £1.5 million in the last year. His salary has been increased by 13.9% to £525,000 to reflect additional duties as chief operating officer, while he also gets a £5,000 a month allowance until a new CEO is appointed. 

How did last year's AGM go? The advisory vote on the annual remuneration report got 81.99% support, a lower level than previous years.

What's the view of voting agencies? Glass Lewis says it would have liked a more detailed response to last year's AGM dissent, but adds that remuneration votes for AIM-listed companies are voluntary. It recommends shareholders vote in favour of this year's report.

How is the company doing on diversity targets? The company is committed to having at least 50% female and over 15% ethnic minority representation across its combined leadership team by 2023 and at every leadership level by 2030. It has exceeded the target recommended in the Hampton-Alexander review, with 33% of the board being female at the end of August.

These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.