This part of the report has been prepared in accordance with Part 3 of The Large and Medium-sized Companies and Groups (Accounts and Reports) (Amendment) Regulations 2013 and 9.8.8R of the Listing Rules.

The following report will be subject to an advisory shareholder vote at the 2019 AGM, which is scheduled to be held on 25 September 2019. The information in the Annual report on remuneration has been audited where indicated.

How will the Remuneration Policy be implemented in the year ending 31 May 2020

Executive Directors' base salaries

The Committee has decided to award a salary increase of 2.5% to both the Chief Executive Officer and Chief Financial Officer. With regard to all other UK-based employees, the average increase has been 3%.

On 23 July 2018, Tim Kowalski was appointed as Chief Financial Officer on a salary of £275,000.

The table below details the Executive Directors' salaries as at 31 May 2019 and salaries which took effect from 1 June 2019.

Base salary at 31 May 2019
£000
Base salary
at 1 June
2019
£000
% Change
Chief Executive Officer4364472.5
Chief Financial Officer2752822.5

Pension and benefits

There will be no changes to pension or benefits provision.

Annual bonus

The annual bonus maximum for the Chief Executive Officer and the Chief Financial Officer in 2019/20 will be 100% of salary with 75% based on the achievement of adjusted operating profit¹ targets and 25% on the achievement of strategic priorities. The strategic priorities for 2019/20 are outlined in Our strategy. To ensure that the bonus is self-funding, no bonus, including any due for achievement of strategic targets, will be payable if the minimum adjusted operating profit target is not met. The profit target will be based on delivery of the Group's own internal plans, which are comprehensively set, scrutinised and agreed by the Board. The Committee believes that the underlying targets are commercially sensitive and cannot be disclosed at this stage. To the extent they are no longer commercially sensitive, they will be disclosed in next year's Report.

In addition, to ensure that this bonus opportunity results in shareholder alignment and provides greater retention value, 35% of any bonus payment will be deferred into nominal cost share options for two years.

The bonus, nominal cost share options and associated dividend equivalents are also subject to malus and clawback provisions.

The targets relating to the 2018/19 bonus payments are shown in the Annual report on remuneration.

Long Term Incentive Plan (LTIP)

It is expected that awards of 100% of base salary will be made under the LTIP in July or August 2019. These will be subject to a two-year post-vesting holding period for Executive Directors. As well as the holding period, the Executives have to achieve a shareholding guideline of 200% of salary (post shares sold to cover any tax) before they can sell any shares that vest. The awards are also subject to malus and clawback provisions.

The vesting of these LTIP awards will be based on Earnings Per Share (60%), a cash flow metric (30%) and a relative Total Shareholder Return metric (10%). The performance conditions for 2019/20 will be the same as for 2018/19:

  • Earnings per share needs to grow at between a threshold 9% and a maximum of 20% per annum over three years to qualify for an award of between 12% and 60% of salary respectively.
  • The cash conversion metric enables executives to earn 30% of salary. A cash conversion ratio of 70% represents the threshold, qualifying for an award of 6% of salary, with the maximum award of 30% due if the cash conversion ratio¹ achieved is 80% or higher.
  • Finally, the relative TSR component is worth up to 10% of salary. If the business achieves a level of share performance equivalent to the median of the FTSE 250 (excluding investment trusts), then this will qualify for an award of 2%. Achieving a share price equivalent to upper quartile for the FTSE 250 will result in the maximum award of 10% of salary.

The Committee believes that these three measures are transparent, easy to understand, easy to track and communicate, cost-effective to measure and fundamentally aligned to the Group's strategic goals.

  1. See note 3 to the Financial Statements for an explanation of Alternative Performance Measures (APMs) and adjusting items. See note 3 to the Financial Statements for a reconciliation to statutory information.

Non-Executive Directors' remuneration

In line with the current Policy, Non-Executive Director fees are reviewed annually.

In 2018/19, this included a review of expenses and the expense claiming processes. Following this review, and taking into account the additional complexities of applying tax and national insurance to many but not all of the expense claims, a simplification was proposed and approved to remove the ability to claim expenses for all UK travel expenses, but instead to provide a compensatory increase to base fees. The compensatory increase was based on the average cost to the Company of previous expense claims, and was set at £4,750 for Non-Executive Directors, and £8,200 for the Chairman. This increase resulted in a new base fee level of £50,750 for NEDs and £146,575 for the Chairman, effective from 6 April 2019.

Annualised FeesAs at
1 June 2019 £000
As at 1 June 2018
£000
Chris Stone147138
Thomas Chambers*46
Chris Batterham6459
Jonathan Brooks5853
Mike Ettling5146
Jennifer Duvalier5146

* Thomas Chambers stepped down from the Board at the 2018 AGM on 26 September 2018.

How has the Remuneration Policy been implemented in the year ended 31 May 2019?

This section sets out how the Remuneration Policy was implemented in 2018/19. The key implementation decisions during the year related to:

  • Determination of annual bonus outcomes for the 2018/19 performance period.
  • Terms of the new Directors appointed to the Board, including the Chief Financial Officer.
  • The performance targets and value of awards to be granted under the LTIP, which will vest in 2021.

Further detail on these decisions, together with other information on payments made to Directors, is set out in the following sections.

Single Total Figure of Remuneration (Audited)

The detailed emoluments received by the Executive and Non-Executive Directors for the year ended 31 May 2019 are below.

DirectorYear
ended
Salary /
Non-Executive Director fees1
£000
Benefits2
£000
Pension benefits3
£000
Annual
bonus4
£000
Long-term incentive5
£000
Other
£000
Total
£000
Chris Stone31 May 2019140140
31 May 2018243243
Adam Palser631 May 20194361222209679
31 May 20182136469292
Tim Kowalski631 May 20192371324104378
31 May 2018
Brian Tenner731 May 20194935125182
31 May 2018300153098443
Chris Batterham31 May 20196060
31 May 20184747
Jonathan Brooks31 May 20195454
31 May 20184646
Jennifer Duvalier631 May 20194747
31 May 201844
Mike Ettling631 May 20194747
31 May 20183131
Thomas Chambers831 May 20191515
31 May 20185151
Debbie Hewitt931 May 2019
31 May 20184848
Total31 May 20191,08528513131251,602
31 May 201898321341671,205
      1. In 2018/19, a review was undertaken of the expenses and the expense claiming processes for the Chairman and Non-Executive Directors. Following this review, and taking into account the additional complexities of applying tax and national insurance to many but not all of the expense claims, a simplification was proposed and approved to remove the ability to claim expenses for all UK travel expenses, but instead to provide a compensatory increase to base fees. The compensatory increase was based on the average cost to the Company of previous expense claims, and was set at £4,750 for Non-Executive Directors, and £8,200 for the Chairman. This increase resulted in a new base fee level of £50,750 for NEDs and £146,575 for the Chairman, effective from 6 April 2019.
      2. Taxable benefits include the provision to every Executive Director of a car or car allowance, payment of private fuel, car insurance, private medical insurance, life assurance and permanent health insurance.
      3. Pension benefits include employer contributions to the Group pension scheme and payments in lieu of pension contributions. The Company provided pension payments in lieu of pension contributions for three Executive Directors during the year ended 31 May 2019.
      4. Annual bonus payments for performance in the relevant financial year; 35% of this bonus is deferred into nominal cost share options for two years. Dividend equivalents accrue on these shares.
      5. Long-term incentive awards vesting under the LTIP.
      6. Adam Palser was appointed as Chief Executive Officer on 1 December 2017. Tim Kowalski was appointed as Chief Financial Officer on 23 July 2018. Mike Ettling and Jennifer Duvalier were appointed as Non-Executive Directors on 22 September 2017 and 25 April 2018 respectively.
      7. Brian Tenner stepped down as an Executive Director and from the Board on 12 August 2018. The Committee agreed his leaving arrangements in line with the Remuneration Policy. He received £125,000 representing six months' basic salary in lieu of notice in accordance with his service agreement. This pay in lieu of notice relates to a contractual payment relating to his departure. The Committee decided not to defer 35% of Brian Tenner's bonus of £97,500 into nominal cost share options for two years hence the £97,500 bonus relating to the financial year ended on 31 May 2018 was paid in full as cash. Brian was not eligible for a bonus for the financial year ended 31 May 2019 (Please see the section on 'Policy on payment for loss of office' within the Directors' Remuneration policy). The Committee determined that Brian Tenner would be treated as a good leaver for the purposes of his unvested 2017 Long Term Incentive Plan award, vesting on its normal vesting date (in 2020), reduced pro rata to 12 February 2019 (being six months from his leaving date) and subject to achievement of the performance criteria. Brian will then be required to hold his shares for a further two years until 2022 in accordance with the Company's shareholding guidelines.
      8. Thomas Chambers stepped down from the Board on 26 September 2018. Prior to that Thomas stepped down as Chair of the Audit Committee with effect from 31 March 2018 and his fee was accordingly reduced from £52,000 to £45,000.
      9. Debbie Hewitt resigned from the Board on 28 March 2018.

In the 2018 Annual Report and Accounts, an omission was made within the Single Total Figure of Remuneration table in the Annual report on remuneration, in that the 2017/18 bonuses were not shown for the CEO and CFO although the bonuses paid were correctly disclosed in the Annual report on remuneration. The above table has been consequently restated.

Additional information in respect of the Single Total Figure of Remuneration

Annual bonus

2018/19 Annual bonus (audited)

For the year ended 31 May 2019, the maximum potential bonus opportunity for Adam Palser was 100% of salary. For Tim Kowalski, the maximum potential bonus opportunity was also 100% of salary but the bonus payable will be prorated to reflect the fact that Tim started on 23 July 2018 and not 1 June 2018.

For Brian Tenner, the maximum potential was also 100% of salary but Brian left on 12 August 2018 and will not be eligible for an annual bonus in respect of the 2018/19 financial year.

The actual bonus paid to Adam Palser was £209,318 and to Tim Kowalski £103,880 based on the achievement of the performance conditions set out below. 35% of each payment will be deferred into nominal cost share options for two years. The performance measures and targets are set out below:

Financial targets – up to 75% of the bonus

Performance targetsAdam PalserTim Kowalski
31 May 2019 Adjusted operating profit¹Threshold£33mWeighting (% of salary)15%15%
Maximum£36mWeighting (% of salary)75%75%
Actual£33.7mPayout (% of salary)28%28%
Strategic
targets
The strategic targets were set individually for the Executive Directors based on key strategic objectives for the year in their area of responsibility – see belowWeighting (% of salary)25%25%
Payout (% of salary)20%16%
Payout (% of salary)48%44%
Total bonus£209,318£103,880

Strategic targets – up to 25% of the bonus

The table below highlights the key strategic targets and achievements for each Executive Director. As the minimum profit target was exceeded, the strategic element of the bonus became eligible for consideration for payment as detailed below.

Maximum % of bonusTarget and performance outcome31 May 2019
Adam PalserTim Kowalski
7.5%Implement ERP and CRM systems for the business.
Achieved – deliverables met on time and on budget. Salesforce rolled out to UK Assurance and Fort Consult in May 2019, and Fox-IT in June 2019.
Concur Expenses system now implemented in UK and Netherlands and already in use by 1,400 staff. The Workday architect phase was completed by the end of May 2019.
7.5%7.5%
5%Develop KPI reporting.
Progress with some KPIs instigated but scope for more work to be done.
0%0%
12.5%Develop and implement a strategic plan for Fox-IT and certain of its product offering.
Achieved – Portfolio reviewed and strategic plan created, new structure around three core business units with leaders having been appointed. Unit Income Statements now communicated and tracked, with a base and stretch three-year plan in place.
12.5%N/A
7.5%Build a fit for purpose Finance Team.
Significant progress with key appointments made.
N/A5%
5%Simplify financial reporting.
Significant progress in providing more information to all areas of the business. Strong performance in cash management after introduction of management reporting to underpin this.
N/A3.5%
      1. See note 3 for an explanation and definitions of Alternative Performance Measures (APMs) and adjusting items. See note 3 to the financial statements for a reconciliation to statutory information.

Long-term incentive plan vesting

LTIP awards vest based on a three-year performance period. As the Chief Executive Officer and Chief Financial Officer have been employed since 1 December 2017 and 23 July 2018 respectively, no LTIP awards vested for the Executive Directors during the year.

LONG-TERM INCENTIVES GRANTED during the year (audited)

During the financial year, the Executive Directors were granted awards which are due to vest on 31 May 2021, subject to the performance conditions set out below. The awards were as follows:

ExecutiveNumber of LTIP awards1BasisFace
value2
Performance conditionPerformance
Period
Adam Palser197,285100% of base salary£436,000Vesting determined by:
  • growth in Adjusted³ EPS over the performance period
  • Average cash conversion ratio³ over the performance period
  • TSR over the performance period vs FTSE 250 comparator group
1 June 2018
to 31 May 2021
Tim Kowalski124,434100% of base salary£275,000As above1 June 2018
to 31 May 2021

The performance conditions for these awards is set out below:

ProportionComponentMetricThresholdThreshold vesting %TargetTarget vesting %MaximumMaximum vesting %Vesting basis
60%EPSAverage growth
over a three-year
period
9%20%n/an/a20%100%Straight-line between threshold and max
30%Cash
conversion
Average Cash conversion ratio³
over three years
70%20%75%50%80%100%Straight-line between threshold and target, then target to max
10%TSRTSR over three years vs FTSE 250 comparator group (excluding investment funds)Median20%n/an/aUpper quartile100%Straight-line between threshold and max
      1. LTIP awards are structured as nominal-cost options (£1 being payable upon each exercise).
      2. Based on a share price of £2.21 which was the closing mid-market price of the Company's shares on the day before the date of grant.
      3. See note 3 to the Financial Statements for an explanation of alternative performance measures (APMs) and adjusting items. See note 3 to the Financial Statements for a reconciliation to statutory information.

SAYE options granted in the year.

The Group operates an HMRC-approved SAYE scheme. All eligible employees, including Executive Directors, may be invited to participate on similar terms for a fixed period of three years. During the year Adam Palser and Tim Kowalski opted to participate in this scheme.

Brian Tenner's outstanding Save as You Earn awards lapsed on the cessation of his employment on 12 August 2018.

These awards will be included in the other column of the single figure table in the 2021/22 annual remuneration report, once they have been exercised.

ExecutiveDate of
grant
Number of optionsBasisFace
value1
Exercise
price
Performance conditionVesting
date
Adam Palser24 Aug 201810,273£500 per month
contribution over
a three-year period
£22,487£1.752Awards vest
subject to
continued
employment
October 2021
Tim Kowalski24 Aug 201810,273£500 per month
contribution over
a three-year period
£22,487£1.752Awards vest
subject to
continued
employment
October 2021
      1. Calculated on the price of £2.189, which was the average mid-market share price over the three days preceding the date of grant.

Directors' interests in shares (audited)

The tables below set out details of the Executive Directors' outstanding share awards, which will vest in future years subject to performance conditions and/or continued service.

Summary of maximum LTIP awards outstanding

Total LTIP Options held
at 31 May
2018
Granted
during
the period
Exercised
during
the period
Share price
on date
of exercise
Lapsed
during
the period
Total LTIP
Options
held
at 31 May
2019
Adam Palser178,601197,285375,886
Tim Kowalski124,434124,434
Brian Tenner1148,77764,26684,511

All awards granted under the LTIP are subject to continued employment and the satisfaction of the performance conditions as set out above. The awards were all nominal cost options.

      1. The Committee determined that Brian Tenner would be treated as a good leaver for the purposes of his unvested 2017 Long Term Incentive Plan award, vesting on its normal vesting date (in 2020), reduced pro rata to 12 February 2019 (being six months from his leaving date) and subject to achievement of the performance criteria. Brian will then be required to hold his shares for a further two years until 2022 in accordance with the Company's shareholding guidelines.

Share ownership (audited)

The beneficial and non-beneficial interests of the current Directors in the share capital of NCC Group plc at 31 May 2019 are set out below:

Beneficial interests
in ordinary shares1
Maximum share awards subject to performance conditions2Share options3Deferred Bonus Plan4Total
31 May
2019
31 May
2018
31 May
2019
31 May
2018
31 May
2019
31 May
2018
31 May
2019
31 May
2018
31 May
2019
31 May
2018
Chris Stone124,38250,000124,38250,000
Adam Palser23,199375,886178,60110,27310,993420,351178,601
Tim Kowalski23,614124,43410,273158,321
Chris Batterham50,00050,00050,00050,000
Jonathan Brooks50,00030,00050,00030,000
Jennifer Duvalier9,5009,500
Mike Ettling50,00050,00050,00050,000
      1. This information includes holdings of any connected persons.
      2. These awards represent the outstanding LTIP interests, which are included in the table above which are due to vest in either July/August 2021 or 2022.
      3. Representative SAYE scheme interest, which are due to vest in October 2021.
      4. Nominal cost share options granted under the 2018-20 Deferred Bonus Plan on 23 August 2018. Subject to a service condition, tax and National Insurance.

The beneficial and non-beneficial interests of the Directors who departed from the Group during the year in the share capital of NCC Group plc shown as at the date of leaving are set out below:

Beneficial interests
in ordinary shares1
Maximum share awards subject to performance conditionsShare optionsTotal
Date of leaving231 May
2018
Date of leaving231 May
2018
Date of leaving231 May
2018
Date of leaving231 May
2018
Brian Tenner111,309111,30984,511148,77711,568 3195,820271,654
Thomas Chambers29,13429,13429,13429,134
      1. This information includes holdings of any connected persons.
      2. Brian Tenner left the Company on 12 August 2018 and Thomas Chambers left the Company on 26 September 2018.
      3. Brian Tenner's SAYE scheme (2017-20) lapsed when he left the Company on 12 August 2018.

Shareholding requirements

The Executive Directors are expected to build and retain a shareholding in the Group at least equivalent to 200% of base salary. Executives will be required to retain all vested deferred bonus shares and LTIP shares released from the holding period, until they have attained the minimum shareholding guideline and even then, only when they have held vested LTIP shares for a minimum period of two years. Executive Directors will also be required to retain all shares vesting from SAYE schemes. For the avoidance of doubt, Executive Directors are permitted to sell sufficient shares in order to meet any tax obligation arising from vesting shares.

(The percentages within this table have been calculated using a three-month average share price (1 March 2019 to 31 May 2019) of £1.56)Shareholding requirements
(% of salary)
Shareholding as at 31 May 2019
(% of salary)
Requirement met
Adam Palser20010%No
Tim Kowalski20013%No

Appointment terms for new Directors

Chief Financial Officer

Tim Kowalski, Chief Financial Officer, joined the business on 23 July 2018. The remuneration arrangements provided to him were in accordance with the current approved Policy and are as follows:

  • Base salary of £275,000
  • Maximum annual bonus potential of 100% of salary, with 35% of any payment deferred into nominal cost share options for two years
  • Annual grant under the LTIP of 100% of salary
  • Allowance in lieu of pension of 10% of salary
  • Benefits of a monthly car allowance of £1,100, private fuel, life assurance of 4 × salary, private medical insurance for self and family and income protection insurance
  • Notice period of six months

Relative importance of the spend on pay

The following table sets out the percentage change in distributions to shareholders and employee remuneration costs.

31 May
2019
£m
31 May
2018
£m
% Change
Employee remuneration costs1154.5146.55.5%
Dividends212.912.80.8%
      1. Based on the figure shown in note 8 to the Financial Statements.
      2. Based on the total cash returned to shareholders in the year ended 31 May 2019 through dividends as shown in note 11 to the Financial Statements (excluding the proposed 2019 final dividend).

Percentage increase in the remuneration of the Chief Executive

The table below shows the movement in the salary, benefits and annual bonus for the Chief Executive between the current and previous financial year compared to all employees of the Company.

The comparator group for salaries and benefits are all employees in the UK – there were no benefit policy changes in this time.

The comparator group for bonus is those in management population who also have an annual scheme, and excludes those on commission and incentive plans.

Element of remuneration% increase
SalaryChief Executive2.5
Employees3.0
Taxable benefitsChief Executive (% of salary)
Employees (% of salary)
Annual BonusChief Executive (% of salary)47.8%
Employees (% of salary)(4.2%)

Performance graph and table

The following graph shows the total shareholder return, with dividends reinvested, from 31 May 2009 against the corresponding changes in a hypothetical holding in shares in both the FTSE All Share and FTSE 250 Indices.

The FTSE All Share and FTSE 250 represent broad equity indices. The Company is a constituent member of the FTSE All Share and the Committee has adopted the FTSE 250 Index for part of its LTIP performance measure. Both indices give a market capitalisation-based perspective.

During the year, the Company's share price varied between £1.19 and £2.24 and ended the financial year at £1.66.

Ten-year historical TSR performance is the growth in the value of a hypothetical £100 holding over ten years. It has been calculated for NCC Group plc, the FTSE All Share and FTSE 250 (excluding investment trusts) based on spot values.

The share price was £2.09 on 1 June 2018 and £1.66 on 31 May 2019.

The table below shows the total remuneration for the Chief Executive over the same ten-year period, including share awards valued at the date they vested.

Year ended1, 2, 3Total remuneration
(£000)
Annual bonus
(% of max)4
Long-term incentives
(% of max)5
31 May 201967948
31 May 2018292132.5
257232.5
31 May 2017610
31 May 20161,0917020
31 May 20159937315
31 May 20141,0897350
31 May 20131,1180663
31 May 20121,0748570
31 May 20111,2226754
31 May 20108367172
      1. Adam Palser was appointed on 1 December 2017. The total remuneration figure above is in respect of the period from 1 December 2017 to 31 May 2018.
      2. During the year ended 31 May 2018, Brian Tenner acted as Interim Chief Executive Officer for the period 1 June 2017 to 30 November 2017. The total remuneration figure above is the total remuneration received in relation to that six month period.
      3. Rob Cotton was CEO in the period above between 1 June 2009 and 31 May 2017.
      4. Note that this shows the annual bonus payments as a percentage of the maximum opportunity.
      5. Shows the LTIP vesting level as a percentage of the maximum opportunity.
      6. In 2012/13 Rob Cotton waived his right to a bonus, which would have been equal to 32% of salary. This was equivalent to 50% of the maximum bonus opportunity.

Membership and attendance

The Remuneration Committee membership consists solely of Non-Executive Directors and comprises Jonathan Brooks as Chairman, Chris Batterham and Jennifer Duvalier. Thomas Chambers stepped down from the Committee on 26 September 2018.

The Company Chairman, Chief Executive Officer, Chief Financial Officer, Chief People Officer and Company Secretary attend the Remuneration Committee by invitation of the Chairman of the Committee from time to time and assist the Committee with its considerations. No Director is involved in setting their personal remuneration.

The attendance of individual Committee members at Remuneration Committee meetings is shown in the table below:

AttendedMeetings attended
Jonathan Brooks4(4)
Chris Batterham4(4)
Jennifer Duvalier4(4)
Thomas Chambers11(1)
      1. Stepped down from the Committee on 26 September 2018.

Advisers to the Committee

During the year, the Committee received advice on senior executive remuneration from Aon plc and was comfortable that the advice was objective and independent. Aon plc is a member of the Remuneration Consultants' Group and is a signatory to their Code of Conduct. The total fee charged 2018/19 for providing advice in relation to executive remuneration was £21,653. Aon plc did not provide any other services to the Company during the year.

The Committee reviews the performance and independence of its advisers on an annual basis.

Service contracts and letters of appointment

The service contracts and letters of appointment of the current Directors include the following terms.

Date of contractNotice period
Executive
Adam Palser1 December 201712 months
Tim Kowalski23 July 20186 months
Non-Executive
Chris Stone6 April 20173 months
Chris Batterham9 April 20153 months
Jonathan Brooks13 March 20173 months
Jennifer Duvalier25 April 20183 months
Mike Ettling1 September 20173 months

Dilution

The LTIP has a dilution limit, for new and treasury shares, of 10% of the issued ordinary share capital of the Company in any ten-year period for any share option scheme operated by the Company. As at 31 May 2019 the Company had utilised13,792,836 (31 May 2018: 17,516,337) ordinary shares through LTIP, SAYE, EMI, CSOP, ISO and ESPP awards counting towards the 10% limit which represents 4.96% (2018: 6.31%) of the issued ordinary share capital of the Company. To clarify, this figure of 4.96% includes both discretionary and all-employee share schemes.

Statement of shareholder voting

The following votes were received from the shareholders in respect of the Directors' Remuneration Report and in respect of the Remuneration Policy:

Remuneration Report
(2018 AGM)
Remuneration Policy
(2017 AGM)
Total number of votes%
of votes cast
Total number of votes%
of votes cast
For1201,787,82699.25202,309,19199.84
Against1,525,4850.75318,6490.16
Total votes cast (for and against excluding withheld votes)203,313,311100.0202,627,840100.0
Votes withheld24354,046,993
Total votes cast (including withheld votes)203,313,746100.0206,674,833100.0
      1. Includes Chairman's discretionary votes.
      2. A vote withheld is not a vote in law and is not counted in the calculation of the proportion of votes cast 'for' and 'against' a resolution.

Approved by the Board and signed on its behalf:

Jonathan Brooks

Chairman, Remuneration Committee

24 July 2019