Dixons Carphone CEO faces shareholder revolt

2905
Dixons Carphone CEO Alex Baldock faces shareholder revolt
Dixons Carphone CEO Baldock was awarded almost 1.2m shares worth £2.34m earlier this year.
// Dixons Carphone CEO Alex Baldock to face investor revolt led by some major City institutions
// The backlash is pertaining to a share award for Baldock
// 15% of Dixons Carphone’s shareholders expected to vote against remuneration report

The chief executive of Dixons Carphone is reportedly facing a potential shareholder revolt at the retailer’s AGM next week, as his share awards draw the ire of some major investors.

According to Sky News, some of Dixons Carphone’s largest shareholders are planning to vote against long-term share awards for Alex Baldock, who took the helm of the electricals retail giant last year.

It’s estimated that at least 15 per cent of Dixons Carphone’s shareholders would oppose the remuneration report at the retailer’s AGM next week, Sky News reported.

Institutional Shareholder Services (ISS), an influential proxy adviser, has reportedly recommended shareholders to vote against it.

It comes after Baldock was awarded almost 1.2 million shares worth £2.34 million under a long-term incentive plan earlier this year.

Last year, Baldock was awarded 783,000 shares, which had an almost equivalent value as the Dixons Carphone’s share price at the time was much higher.

“The [remuneration] committee gave detailed consideration as to whether the overall size of the award should be scaled back in response to the fall in share price,” Dixons Carphone’s annual report reads.

“However, it also took into consideration the fact that this fall is partly a reflection of the challenges in the retail sector, and also that the new management team has only recently been appointed.

“Taken with the executive directors’ decision to voluntarily defer the full amount of this year’s bonus into shares, the committee concluded that the proposed award level was appropriate.”

ISS said Dixons Carphone’s explanation was “not considered to be particularly compelling to warrant a significant transfer of equity to the lead executive when compared to previous years”.

Dixons Carphone has had a troubled year so far.

In its full-year report published last month, it revealed a 22 per cent plunge in pre-tax profit to £298 million.

This prompted Baldock to accelerate Dixons Carphone’s five-year transformation plan, which included merging the Currys PC and Carphone Warehouse teams and investing £200 million in staff training to improve customer service.

In March, the Financial Conduct Authority slugged the tech giant with a £29.1 million fine for mis-selling Geek Squad service between 2008 and 2015 – prior to Baldock’s arrival as chief executive.

Late last year, Dixons Carphone grabbed headlines after a major data breach affected up to 10 million customers.

Click here to sign up to Retail Gazette’s free daily email newsletter