- Remuneration Committee
- Remuneration Policy
- Remuneration Components for Executive Directors
- Incentive Arrangements
- Disclosure of Directors' Pension Benefits for the year ended 31 March 2005 (audited)
- Other Benefits
- Directors' Remuneration for the year ended 31 March 2005
- Directors' Interests in Incentive Plans and Share Options (audited)
Disclosure of Directors’ Pension Benefits for the year ended 31 March 2005 (audited)
| Age at 31 March 2005 Years |
Accrued pension as at 31 March 2005b £ |
Increase in accrued pension benefits £ |
Transfer value as at 31 March 2005c £ |
Transfer value as at 31 March 2004c £ |
Increase in transfer value less Directors’ contributionsd £ |
|
| R B Butler | 45 | 140,252 | 12,834 | 1,379,000 | 1,171,000 | 190,455 |
| J L Hewitte | 57 | 14,167 | 2,067 | 245,000 | 197,000 | 42,935 |
| R A Lawsona | 60 | 75,334 | 3,606 | 1,516,000 | 1,319,000 | 197,000 |
| I Mason | 43 | 23,493 | 4,609 | 208,000 | 153,000 | 49,935 |
Notes: (a) Mr Lawson became a deferred member of the Scheme on 20 July 2001 on his appointment as Chairman Designate. This table only reflects the scheme benefits retained, and includes credit for transfers received and service to 20 July 2001. (b) Accrued pension benefits shown are the amounts which would be paid annually on retirement based on service to the end of the year. (c) Transfer values have been calculated in accordance with the Guidance Note published by the Institute and Faculty of Actuaries (GN11)(Version 9.1). (d) The increase in transfer value less Directors’ contributions includes the effect of fluctuations in the transfer value due to factors beyond the control of the Company and Directors, such as stock market movements. It is calculated after deducting the Director’s contributions. (e) Additional contributions of £103,750 were paid into a funded unapproved arrangement (FURB) for Mr Hewitt (2004: £101,368).
All Executive Directors are provided with a company mobile phone, a company car (or a cash allowance) and medical insurance. The taxable value of these benefits is included in the Directors’ emoluments table below.
Service Contracts (not subject to audit)
All current Executive Directors have service contracts that are on a 12 month rolling basis. These contracts provide for 12 months’ notice by the Company and by the Executive Directors.
Termination payments are limited to the Directors’ normal compensation, including basic salary, annual incentives and benefits for the unexpired portion of the notice period subject to performance and Remuneration Committee discretion. However, the Committee will aim to minimise the level of payments to that Director having regard to all circumstances, including the Company’s contractual obligations to the Director, the reason for the departure, and the Company’s policy to apply mitigation in the case of severance.
The Company entered into the current contractual agreements with Mr Butler and Mr Mason on 1 March 2001 and with Mr Hewitt on 14 March 2001. These agreements replaced all prior arrangements.
Mr Lawson entered into a service agreement as Chairman of the Company on 20 July 2001. This agreement replaced all prior arrangements. The contract provides for 12 months’ notice of termination to be given by the Company or by Mr Lawson at any time. It shall automatically terminate at the date of the Company’s Annual General Meeting in 2006 unless renewed by the Company.
External Appointments (not subject to audit)
Executive Directors are encouraged to take up one non-executive position on the boards of other companies on the condition that any fees are remitted to the Company.
Performance Review (not subject to audit)
The following graph shows the five year Total Shareholder Return (TSR) performance of the Company relative to both the comparator group used for the 2002, 2003 and 2004 LTIOP grants and the FTSE All Share Index. These indices were chosen because they provide a comparison of the Company’s performance against the comparator group chosen for the awards made under the LTIOP, the Company’s main share incentive scheme, and a broad equity market index.
Brambles Industries plc who are part of the comparator group became a listed company on 31 August 2001 and have only been included in the comparator group from this date.
The TSR of Electrocomponents’ shares was -12.2% p.a. over the period compared with -7.7% p.a. for the LTIOP comparator group and -2.2% p.a. for the FTSE All Share Index.
Directors’ Remuneration for the year ended 31 March 2005
Salary, Annual Bonus and Other Benefits (audited)
| Salary 2005 £ |
Salary 2004 £ |
In lieu of pension 2005 £ |
In lieu of pension 2004 £ |
Benefits 2005 £ |
Benefits 2004 £ |
Bonus 2005 £ |
Bonus 2004 £ |
Total 2005c £ |
Total 2004c £ |
|
| Emoluments of the Chairman | ||||||||||
| R A Lawson | 178,333 | 160,000 | – | – | 24,899 | 23,462 | – | – | 203,232 | 183,462 |
| Emoluments of Executive Directors | ||||||||||
| R B Butler | 292,417 | 285,500 | – | – | 9,549 | 13,877 | – | 50,000 | 301,966 | 349,377 |
| J L Hewitta | 375,250 | 366,000 | 174,088 | 170,175 | 26,786 | 23,602 | – | 60,000 | 576,124 | 619,777 |
| I Masona | 451,000 | 438,750 | 55,690 | 54,214 | 20,359 | 22,076 | – | 100,000 | 527,049 | 615,040 |
| Totals | 1,297,000 | 1,250,250 | 229,778 | 224,389 | 81,593 | 83,017 | – | 210,000 | 1,608,371 | 1,767,656 |
| Fees of Non-Executive Directors | ||||||||||
| K Abbott | 14,800 | – | ||||||||
| L Atkinsonb | 45,083 | 35,000 | ||||||||
| T G Barkerb | 42,333 | 32,000 | ||||||||
| K Hamill | 35,667 | 32,000 | ||||||||
| F D Lennertz | 44,583 | 40,000 | ||||||||
| N J Temple | 35,667 | 32,000 | ||||||||
| D S Winterbottomb c | 14,417 | 35,000 | ||||||||
| Totals | 1,840,921 | 1,973,656 | ||||||||
Notes: (a) Provision of pension benefits under the Group’s approved pension arrangements is restricted for employees joining the Scheme after 1 June 1989. During the year ended 31 March 2005, Mr Hewitt and Mr Mason have elected to receive salary supplements of £70,338 and £55,690 respectively (2004: £68,807 and £54,214) in lieu of the balance of their pension entitlements. In addition, Mr Hewitt also elected to receive payments to a FURB of £103,750 during the year (2004: £101,368). (b) Dr Atkinson, as Chairman of the Remuneration Committee and Mr Winterbottom (until his retirement in July) and Mr Barker (thereafter) as Chairmen of the Audit Committee, each receive an additional fee of £10,000 per annum pro rata. (c) No payments were made during the years ending 31 March 2004 or 31 March 2005 in connection with (i) compensation for loss of office, or (ii) reimbursable taxable expenses.
Directors’ Interests in Incentive Plans and Share Options (audited)
Long Term Incentive Plan (LTIP) (Note a)
| Date of grant |
Vesting date |
Market price on grant |
Shares at 31 March 2004 |
Granted in FY05 |
Shares vested in FY05 |
Lapsed in FY05 |
Shares at 31 March 2005 |
|
| R B Butlera | 30-Jun-01 | 30-Jun-04 | 544.3p | 47,767 | – | – | 47,767 | – |
| J.L Hewitta | 30-Jun-01 | 30-Jun-04 | 544.3p | 60,628 | – | – | 60,628 | – |
| R A Lawsona | 30-Jun-01 | 30-Jun-04 | 544.3p | 80,837 | – | – | 80,387 | – |
| I Masona | 30-Jun-01 | 30-Jun-04 | 544.3p | 58,791 | – | – | 58,791 | – |
Notes: (a) The awards granted under the LTIP on 30 June 2001 did not vest and so they lapsed on 30 June 2004.
Incentive Plans and Share Options (audited)
| Scheme | Date of grant |
Vesting date |
Expiration date |
Exercise price |
Shares under option 31 march 2004 |
Granted in FY05 |
Exercised in FY05 |
Lapsed in FY05 |
Shares under option 31 March 2005 |
|
| R A Butler | 1988 Executive |
28-Jul-95 | 28-Jul-98 | 27-Jul-05 | 306.1p | 24,750 | – | – | – | 24,750 |
| 28-Jul-95 | 28-Jul-00 | 27-Jul-05 | 306.1p | 14,850 | – | – | – | 14,850 | ||
| 28-Jul-95 | 28-Jul-02 | 27-Jul-05 | 306.1p | 9,900 | – | – | – | 9,900 | ||
| Savings Related |
28-Jun-03 | 01-Sep-06 | 28 Feb-07 | 260.0p | 3,557 | – | – | – | 3,557 | |
| aLTIOP | 22-Aug-02 | 21-Aug-05 | 21-Aug-12 | 312.0p | 363,868 | – | – | – | 363,868 | |
| 16-Jun-03 | 15-Jun-06 | 15-Jun-13 | 349.0p | 354,426 | – | – | – | 354,426 | ||
| 11-Jun-04 | 10-Jun-07 | 10-Jun-14 | 365.0p | – | 340,000 | – | – | 340,000 | ||
| Total | 771,351 | 340,000 | – | – | 1,111,351 | |||||
| J L Hewitt | Savings Related |
28-Jun-03 | 01-Sep-08 | 28-Feb-09 | 260.0p | 6,125 | – | – | – | 6,125 |
| aLTIOP | 22-Aug-02 | 21-Aug-05 | 21-Aug-12 | 312.0p | 461,333 | – | – | – | 461,333 | |
| 16-Jun-03 | 15-Jun-06 | 15-Jun-13 | 349.0p | 454,806 | – | – | – | 454,806 | ||
| 11-Jun-04 | 10-Jun-07 | 10-Jun-14 | 365.0p | – | 435,000 | – | – | 435,000 | ||
| Total | 922,264 | 435,000 | – | – | 1,357,264 | |||||
| R A Lawson | 1988 Executive |
28-Jul-95 | 28-Jul-00 | 27-Jul-05 | 306.1p | 54,080 | – | – | – | 54,080 |
| 28-Jul-95 | 28-Jul-02 | 27-Jul-05 | 306.1p | 13,520 | – | – | – | 13,520 | ||
| Total | 67,600 | – | – | – | 67,600 | |||||
| I Mason | 1988 Executive |
28-Jul-95 | 28-Jul-00 | 27-Jul-05 | 306.1p | 30,300 | – | – | – | 30,300 |
| 28-Jul-95 | 28-Jul-02 | 27-Jul-05 | 306.1p | 20,200 | – | – | – | 20,200 | ||
| Savings Related |
28-Jun-03 | 01-Sep-08 | 28-Feb-09 | 260.0p | 6,125 | – | – | – | 6,125 | |
| aLTIOP | 22-Aug-02 | 21-Aug-05 | 21-Aug-12 | 312.0p | 552,300 | – | – | – | 552,300 | |
| 16-Jun-03 | 15-Jun-05 | 15-Jun-13 | 349.0p | 545,272 | – | – | – | 545,272 | ||
| 11-Jun-04 | 10-Jun-07 | 10-Jun-14 | 365.0p | – | 525,000 | – | – | 525,000 | ||
| Total | 1,154,197 | 525,000 | – | – | 1,679,197 |
Notes: (a) Awards made under the Long Term Incentive Option Plan are subject to performance conditions which be viewed by clicking here. The closing mid-market price of the shares on 31 March 2005 was 247.5p. During the year, the price of shares varied between 247.5p and 377.8p. No other awards have been made during the year.
By Order of the Board
Dr Leslie Atkinson
Chairman of the Remuneration Committee
25 May 2005
