Trading Update and AGM Resolution Votes Update

RNS Number : 4024Q

Castings PLC

26 February 2021

 

Castings plc

Trading Update, Notice of Results and Update on AGM Resolution Votes

Castings PLC announces a trading update in respect of the year ending 31 March 2021.

We reported in November 2020 that demand from the commercial vehicle sector had increased to approximately 85% of pre-Covid output levels with forward schedules at that time suggesting a return to 100%. It is pleasing to report that monthly demand has been running ahead of pre-Covid levels with minimal disruption following the end of the Brexit transition period. However, short-term demand schedules have been tempered slightly as OEMs seek to manage supply constraints on certain components, particularly semiconductors.

Whilst demand has improved, production has been hampered by the need for more employees to self-isolate as UK Covid cases increased around the turn of the year; thankfully this now appears to have subsided. Furthermore, we have seen significant increases in raw material prices in the last two months which, due to the nature of the price escalator mechanism, will not be recovered in the selling price until the next financial year.

Overall the results for the year are anticipated to be in line with market expectations.

Notice of Results

The group intends to announce its results for the year ending 31 March 2021 on 16 June 2021.

Update on AGM Resolution Votes

At the AGM held on 13 August 2020, resolutions to approve the new Remuneration Policy and Restricted Share Plan were passed with 76.8% of votes cast being in favour. Following the AGM, as required by the Combined Code, the Chairman of the Remuneration Committee wrote to the shareholders who had cast the majority of votes against the resolutions in order to understand the reasons behind their votes. From responses received, it appears that certain shareholders were voting in accordance with recommendations made by Institutional Shareholder Services, a proxy advisory organisation ('ISS'), which advised against support of the resolutions on the grounds that the Restricted Share Plan provides for vesting of shares subject only to continuing employment and does not impose performance hurdles.

When developing the Restricted Share Plan, the Remuneration Committee took external advice and considered the possibility of imposing vesting conditions in line with ISS's policy. The Committee remains of the view that, taking into account the overall structure of executive remuneration and the desire to avoid a complicated scheme, the simple and relatively modest form of plan approved by shareholders at the AGM is in line with the Group's culture and serves its best interests.

S J Mant, Director and Company Secretary

Castings plc, Lichfield Road, Brownhills, West Midlands WS8 6JZ

26 February 2021

 

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