TheTimes8April2020

34 2GM Wednesday April 8 2020 | the times

Business

Awkward squad left out by

1

The government is urging

companies to curtail executive

pay packages as a wave of them

furlough staff and access taxpayer

aid amid the coronavirus crisis.

Ministers are looking for company

remuneration committees to use

“discretion” when agreeing

directors’ pay and to adjust future

pay in some cases. Page 33

2

Eurozone finance ministers

remain deeply divided over

how to fund a coronavirus

economic recovery package or an

emergency trigger for the

European Union’s bailout fund.

The dispute is over whether to

attach conditions to use of an

emergency fund. Page 33

3

World stock markets rallied

for a second consecutive day

amid further signs that the

spread of the coronavirus is

slowing. The FTSE 100 closed up

122.06 points, or 2.2 per cent, at

5,704.45 and Wall Street was on

course to pull itself out of a bear

market. Page 33

4

Centrica, Britain’s biggest

energy supplier, has placed

3,800 workers on

government-paid furlough as it

reduces its operations during the

Covid-19 crisis. The owner of

British Gas said that it had

refocused most staff toward

emergency work and looking after

vulnerable customers but some

could not be redeployed.

5

Fears that the coronavirus

crisis could weigh on young

shoppers’ enthusiasm for

new clothes has prompted Asos,

the online fashion retailer, to raise

more than £200 million from

investors to bolster its balance

sheet.

6

Britain ended a decade of

weak productivity by

registering zero growth last

year, according to official figures.

The Office for National Statistics

said that output per hour had risen

by only 0.3 per cent in the final

quarter of last year and was flat for

2019 overall. Productivity rose in

only two of the previous six

quarters. Page 36

7

The wild swings in markets

caused by the Covid-19 crisis

might have wrongfooted

traders, but they have helped to

propel quarterly revenues at

Plus500 to record levels. Page 38

8

A crackdown on dividend

payments by insurers in

Europe threatens to

complicate Aviva’s plan to pay

£839 million to its shareholders.

The FTSE 100 company has

declared a 21.4p-a-share final

dividend for 2019 that is due to be

given to its investors on June 2.

Page 39

9

Cineworld has halted dividend

payments and is holding talks

with its banks as Britain’s

biggest cinema chain scrambles to

bolster its finances. All of its 787

cinemas in ten countries have

been closed because of the

coronavirus crisis. Page 40

10

Audit profits at Grant

Thornton fell by 90 per

cent during a difficult year

in which the accountancy firm was

put under investigation by the

industry regulator for unacceptable

performance. Page 41

Need to know

Centrica puts 3,800 on paid leave

Britain’s biggest energy supplier has

placed 3,800 workers on government-

paid furlough as it reduces operations

during the Covid-19 outbreak.

Centrica said that it had refocused

most of its staff towards emergency

work and to looking after vulnerable

customers, but some could not be rede-

ployed. These affected employees will

receive 100 per cent of their salaries,

with the company topping up the 80 per

cent provided by the government

through its coronavirus job retention

scheme.

Last week the British Gas owner

suspended its proposed final dividend

and unveiled a series of cost-cutting

measures to shore up its finances. It is

one of several energy companies to

have approached the government over

financial support to help them to cope

with customers who cannot pay bills.

Centrica, which reported adjusted

profits of £901 million last year, em-

ploys about 27,000 people. About

20,000 of these are in Britain, with the

lion’s share in British Gas, which sup-

plies about seven million households,

supplies businesses and offers home

services such as boiler repair. Most of

the rest are in North America. Work

that has been postponed includes

meter reading, installations and annual

boiler services. Centrica said that it was

concentrating on critical work to

maintain hot water and heating and

was prioritising tasks such as appliance

breakdown repairs.

A spokesman said: “Our employees

are playing a vital role in keeping our

customers warm and ensuring they

have hot water and power to stay

connected. However, we’ve had to scale

back some of our operations to focus on

emergency work only and looking after

our vulnerable customers.

“In the short term, we are placing

some colleagues, who we can’t redeploy

to emergency or vulnerable operations,

into furlough to protect jobs and our

business. They will receive 100 per cent

of their regular salary.”

Eon, the German group that is

Britain’s second biggest supplier, has

placed about 4,000 of its staff in Britain

on leave, including 3,000 at its Eon UK

supply division and 1,000 at Npower,

which it recently acquired. Ovo, the

third biggest supplier in Britain, which

recently acquired the domestic supply

business of SSE, has put 3,400 of its

employees on furlough.

Shares in Centrica, a member of the

FTSE 100 index, rose yesterday, closing

¾p, or 2.8 per cent, ahead at 32½p.

Emily Gosden Energy Editor

continued from page 33

Europe split over coronabonds

follows outright rejection by Giuseppe

Conte, Italy’s prime minister, because

of the conditions attached. He told

other EU leaders: “Don’t bother, you

can keep it.”

As delayed talks began yesterday, the

compromise was in tatters after Wopke

Hoekstra, the Dutch finance minister,

insisted that there must be precondi-

tions if the ESM was to be used for

economic recovery.

“I think it is reasonable and sensible

that providing money goes hand-in-

hand with reforms and agreements,” he

said. Only emergency funds for acute

medical care could lack strings, he said.

The Netherlands is also worried

about a European Commission plan to

create a fund, using €25 billion of

national guarantees to pay for short-

time working schemes.

The most divisive issue is the push to

to move quickly to “coronabonds” or

debt mutualisation to create a post-

pandemic economic recovery fund

worth more than €400 billion.

S

hortly before 2pm tomorrow,

Susan Swabey will stroll the

500 yards from her home in the

Chilterns to nearby Sheet-

hanger Common. She will be

holding a laptop, a sheaf of documents,

a walking stick and a cinnamon bun.

Pausing only to admire the oaks and

any passing deer, the company secre-

tary of Smith & Nephew will then

launch what is almost certainly the first

al fresco annual shareholders meeting

of a FTSE 100 company. Not to

mention the least well-attended.

The laptop is to keep in touch with

registrars and lawyers working re-

motely. The documents are required

legal papers, such as directors’ service

contracts. The walking stick is to ward

off anyone straying within two metres.

And the bun is for her husband, Peter, a

fellow shareholder in the medical

products group, who by turning up

makes the meeting quorate.

There’s no official playbook for

holding an annual meeting in the

middle of a pandemic. The stay-at-

home and social distancing rules have

driven all norms out of the window.

Companies are scrambling to read the

official coronavirus guidance, the

Companies Act and their own articles

of association to understand what they

need to do.

Some have been wrongfooted by

events. BP had been due to hold its

meeting at the Excel conference centre

in London’s Docklands, a building now

converted to a field hospital and likely

to be filled with up to 4,000 highly

infectious coronavirus patients by the

meeting date of May 27. There’s little

chance of that venue being used now,

therefore, although the company has

yet to update shareholders on any new

arrangements.

Last week Hikma Pharmaceuticals,

the FTSE 100 drugs company, moved

its annual meeting, scheduled for the

end of the month, from the five-star

Sofitel in London to the home of the

company secretary in Surbiton in the

southwestern fringes of the capital.

The shutdown could not have come

at a worse time for the many companies

whose years end of December 31.

AGMs have to take place within six

months of the year-end, so bookings for

April, May and June must be cancelled.

Attending in person is out of the

question for now, usually for all but two

company directors or shareholders.

Businesses including Smith & Nephew

have explicitly banned their share-

holders from attending.

That compares with two weeks ago,

when companies were merely trying to

deter private shareholders by saying

that there would be no refreshments

(British American Tobacco) or no

goodie bags (Glaxosmithkline).

While most companies are opting for

the most stripped-down of meetings,

completely virtual ones are impossible

for many because usually two to four

people must be physically present for

the meeting to be quorate, Lisa Gra-

ham, head of meetings management at

Equiniti, the registrars group, said.

Every year she organises more than

400 meetings for companies and has

seen it all, from directors being publicly

accused of affairs to protestors chaining

themselves to desks. “A lot of company

articles simply do not allow for a totally

virtual AGM,” she said.

Technologically, few have the nec-

essary expertise to hold a live AGM

entirely in cyberspace. Jimmy Choo,

the luxury footwear company, became

the first London-listed company to

hold a completely virtual AGM in 2015,

but the trend didn’t catch on in Britain.

Investors understand the need for a

very different approach this year but

are concerned that the rights of share-

holders could be abused. Institutional

investors are routinely given private

meetings and phone calls with senior

management, but for smaller investors

the AGM is the only opportunity to ask

questions and have their views heard.

Peter Parry, policy director of the UK

Shareholders’ Association, said: “It is so

important that shareholders should

have the chance to ask searching ques-

tions, particularly at this time.” He said

that those questions needed to be

answered before voting took place.

Hotels and HQs won’t

do for meetings this year,

write Patrick Hosking,

Alex Ralph, Ben Martin

and Emily Gosden

2019 Hotel Sofitel, London

£901m

Adjusted profits for last year

Centrica