Punch Taverns plc 2011 Annual Report

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26 Punch Taverns plc Annual Report and Financial Statements 2011 Directors’ report continued Additional information for shareholders At 20 August 2011, the Company’s issued share capital comprised a single class of shares known as ordinary shares. The Share capital note on page 87 of this report contains full details of shares allotted and provides an explanation of the movements in share capital, during the period. Only partnership shares, in respect of the Company’s SIP, were purchased by the Company during the period. At the last AGM, held on 17 December 2010, the Company obtained shareholder authority to buy back up to 64,286,783 shares (representing approximately 10% of the Company’s ordinary shares in issue as at 1 November 2010). It was made clear that this authority would only be exercised by the Directors after they had given due consideration to the effects on earnings per share and the benefits for shareholders. During the period, the Directors did not exercise their right to buy back any of the Company’s shares currently in issue. This authority is due to expire at the conclusion of the Company’s next AGM where new authority to buy back up to 65,982,811 shares (representing approximately 10% of the Company’s ordinary shares in issue as at the date of the AGM Notice) will be sought. Authority will also be sought at the forthcoming AGM for Directors to allot up to 21,942,702 shares in the Company (representing approximately one-third of the Company’s ordinary shares in issue (excluding treasury shares) as at the date of the AGM Notice) and up to 439,885,405 equity securities (representing approximately two-thirds of the Company’s ordinary shares in issue (excluding treasury shares) as at the date of the AGM Notice). This will replace the authority granted by shareholders at the Company’s previous AGM. The Board will also seek authority to disapply pre-emption rights over 32,991,405 shares (representing approximately 5% of the Company’s ordinary shares in issue as at the date of the AGM Notice). General meetings At a general meeting of the shareholders, the Company’s Articles of Association may be amended by special resolution. Also at a general meeting of the Company on a show of hands every member who is present in person and proxy entitled to vote shall have one vote. On a poll every member who is present in person and proxy shall have one vote for every share of which he is the holder. A shareholder may appoint more than one proxy in relation to their holdings provided that each proxy does not vote in relation to the same shares. The Notice of Meeting sent to shareholders with this report gives full details of deadlines for exercising voting rights and appointing a proxy or proxies to vote in relation to resolutions to be considered at the meeting. Post-balance sheet events Subsequent to the year end there were no post-balance sheet events. Directors’ statement as to disclosure of information to auditors The Directors confirm that, so far as they are aware, there is no relevant audit information of which the auditors are unaware and that each Director has taken all reasonable steps to make themselves aware of any relevant audit information and to establish that the auditors are aware of that information. Auditors A resolution to reappoint KPMG Audit Plc as the Company’s auditors will be put to the forthcoming AGM. By order of the Board of Directors Ed Bashforth Company Secretary The Directors have no present intention to exercise any of the above authorities except to satisfy the allotment of shares under the Company’s employee share incentive plans. Further details of the above resolutions are contained within the Notice of Meeting sent to shareholders with this report. There are no restrictions on transfer of shares in the Company other than those which may from time to time be applicable under existing laws and regulations (for example under the Market Abuse Directive) and the Company is not aware of any agreements between shareholders that may result in restrictions on the transfer of securities or on voting rights. In addition, there are no people holding securities that carry special rights with regard to control of the Company. In addition, pursuant to the Listing Rules of the Financial Services Authority, Directors and persons discharging managerial responsibility (PDMRs) of the Company require prior approval from the Company to deal in the Company’s securities, and are prohibited from dealing during a Close Period.
Punch Taverns plc Annual Report and Financial Statements 2011 27 Corporate governance statement The Company is committed to high standards of corporate governance and demonstrates this by being fully compliant with all the provisions of the 2010 UK Corporate Governance Code (the ‘Code’) and chapter 7 of the Disclosure and Transparency Rules (the ‘DTR’) throughout the period from 22 August 2010 to 20 August 2011. A copy of the Code is available on the Financial Reporting Council’s website (www.frc.org.uk). This report, together with the Directors’ report (which includes information as required by section 7.2.6 of the DTR, as permitted by section 7.2.9 of the DTR) and the Report on Directors’ remuneration, provides an overview of how the Group has applied the principles of the Code throughout the period. It details the work and activities undertaken by the Company’s relevant Committees and sets out the key features of the Company’s governance structure. The role of the Board The Company is headed by an effective Board which is collectively responsible for the long-term success of the Company. The work of the Board is structured around scheduled Board meetings which are linked to key events in the Company’s corporate calendar, with additional meetings and conference calls convened to consider matters which are time-critical or which require further discussion. Together the Board is collectively responsible to the Company’s shareholders for the Group’s performance and sets the strategic aims and objectives of the Group to fulfil this responsibility. The Board determines the Company’s key policies, agrees on performance criteria and delegates to senior management their planning and implementation. Overall, the Board ensures that all necessary resources are in place in order for the Company to meet its objectives and that all decisions are taken objectively and in the interest of the Company and its shareholders. Whilst the Board has delegated the normal operational management of the Company to the Executive Directors and other senior management, it retains a schedule of matters which are dealt with by the Board. These include, amongst others, strategy and management, structure and capital, financial reporting and controls, significant contracts, material acquisitions and disposals, investments and capital projects. During the period the Board held 12 scheduled Board meetings, the attendance of which was as follows: Board meetings Nomination and Governance Committee meetings Audit and Risk Committee meetings Remuneration Committee meetings Director Roger Whiteside 11/12 N/A N/A N/A Steve Dando 1 8/8 N/A N/A N/A Peter Cawdron 2 12/12 4/4 N/A 0/0 Ian Dyson 3 12/12 0/0 0/0 N/A Ian Fraser 4 12/12 N/A 7/7 5/5 Mark Pain 5 11/12 3/3 7/7 5/5 Mike Tye 6 12/12 N/A N/A N/A Phil Dutton 7 4/4 N/A N/A N/A Walker Boyd 8 4/4 N/A N/A N/A Ian Wilson 9 5/5 1/1 2/2 N/A Tony Rice 10 12/12 4/4 4/5 5/5 1 Steve Dando was appointed to the Board on 10 May 2011 and appointed as acting Finance Director on 1 February 2011. 2 Peter Cawdron was appointed Chairman of the Nomination and Governance Committee on 25 January 2011 and was appointed as a member of the Remuneration Committee on 1 August 2011. Peter retired as Chairman on 15 September 2011 and was replaced by Stephen Billingham. 3 Ian Dyson was appointed as Chief Executive Officer on 6 September 2010 and resigned on 1 August 2011 but he remains on the Board as a Non-executive Director. Ian was appointed to the Nomination and Governance Committee and Audit and Risk Committee on 1 August 2011. 4 Ian Fraser is Chairman of the Audit and Risk Committee. 5 Mark Pain was appointed to the Nomination and Governance Committee on 25 January 2011. At demerger on 1 August 2011 Mark was appointed Senior Independent Non-executive Director in place of Tony Rice and was appointed Chairman of the Remuneration Committee. 6 Mike Tye resigned from the Board at demerger on 1 August 2011. 7 Phil Dutton resigned on 17 December 2010. 8 Walker Boyd was appointed on 12 April 2011 and resigned on 1 August 2011. 9 Ian Wilson resigned from the Board, the Nomination and Governance Committee and the Audit and Risk Committee on 25 January 2011. 10 Tony Rice was appointed to the Audit and Risk Committee on 25 January 2011. Tony, as Senior Independent Non-executive Director, resigned from the Board at demerger on 1 August 2011 and also resigned from the Nomination and Governance Committee and the Audit and Risk Committee. Division of responsibilities There is a clear division of responsibilities at the head of the Company between the running of the Board and the executive responsibility for the running of the Company’s business. No one individual has unfettered powers of decision. There is a clear division of responsibility between the Chairman and Chief Executive Officer which has been formally documented and approved by the Board. The Chairman and Chief Executive Officer The Chairman is responsible for leadership of the Board and ensuring its effectiveness on all aspects of its role. On 15 September 2011, Stephen Billingham was appointed Chairman following the retirement of Peter Cawdron. On appointment, Stephen Billingham met the independence criteria set out in the Code. As Chairman of the Board, Stephen Billingham is responsible for: • the leadership of the Board, ensuring its effectiveness and setting its agenda; • ensuring that adequate time is available for discussion of all agenda items, in particular strategic issues; • arranging the regular evaluation of the performance of the Board, its Committees and individual Directors; and • promoting a culture of openness and debate by facilitating the effective contribution of Non-executive Directors and ensuring constructive relations between Executive and Non-executive Directors; • ensuring that, through the Company Secretary, the members of the Board receive clear, accurate and timely information; and • ensuring effective communication with shareholders. The Chief Executive Officer, supported by the Finance Director, is responsible for: • developing strategic operating plans; • preparing annual budgets and medium-term projections for the Group and closely monitoring performance against plans and budgets; • ensuring effective communication with shareholders; and • overseeing the day-to-day management of the Group. Financial statements Governance Business review
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