Penneys is a winner for ABF
Associated British Foods (ABF) has been a winner for shareholders who bought in a year ago. The stock has risen in London from just under £15 (€18) to £22.70. The owner of Primark, which trades as Penneys in Ireland, is a diversified group, with interests in grocery, sugar production and agricultural products. But it is Primark, which has its HQ in Dublin, that has been the driving force in the past few years, especially as the brand is rolled out across Europe.
But UK-based PIRC (Pensions & Investment Research Consultants), which advises investors with more than £1.5 trillion (€1.8trn) worth of assets, has poured cold water on things at ABF, which is controlled by the Weston family. PIRC says that combined awards for executives, when its long-term incentive plan (LTIP) is taken into account, were excessive. With regards the new LTIP at ABF, PIRC says: "No performance targets have been disclosed and it is unclear how many targets and on what basis performance will be measured.
"This makes assessing the suitability of the scheme impossible and frankly frustrates shareholder accountability." PIRC has asked shareholders to oppose the new LTIP scheme at the upcoming ABF AGM and also to reject the remuneration report.
"There are concerns that this level of non-audit fees creates a potential for conflict of interest on the part of the independent auditor," says PIRC.