PCF Group (GPW:PCF) — General Meeting

0:01 Good morning, ladies and gentlemen, and welcome to the PCF GROUP PLC general meeting. Throughout this recorded meeting, attendees online will be in listen only mode. Questions are encouraged and can be submitted at any time via the q and a tab. It's just situated on the right hand corner of your screen. Please just simply type in your questions at any time and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, all questions will be reviewed with responses published on the Investor Meet company platform where it is appropriate to do so. I'd now like to hand you over to Chairman Simon Moore. Good morning, sir. Thanks, Jake, and good morning, everybody. It's my pleasure to welcome shareholders to the meeting today, both those who are here in the room and those who are watching the proceedings via the investor meet company link. Welcome to the general meeting of PCF GROUP PLC. I'm Simon Law, the Chairman of the company.

0:51 Those of you who attended our AGMs, general meetings in the past will be familiar with the way this works. First of all, we'll deal with the formal business of the day, taking the resolutions and any questions on those resolutions, and I'll then formally close the meeting, at which point the board of directors will be available to take any general questions. With me today are your directors, Mark Brown, Christine Higgins, David Morgan, Caroline Richardson, Mark Sisme Durant, Gary Strand, and David Titmus. It's now just gone 10:00. We have a quorum present, so so I declare the meeting open. You will have received a copy of the notice of the general meeting posted on the 06/20/2022.

1:37 And with your permission, I'll take that notice as read. Good? Thank you very much indeed. That's very helpful. I'm just gonna run through the formalities of the voting procedures first, and this is the way we've done this in the past. As previously notified, the voting today by will be by way of poll with no voting by show of hands. That gives all shareholders the opportunity to participate in the decision making of the company proportionate to the number of shares they own, and it also allows the company to get a better view of the voting powers of shareholders. A summary of the resolutions will be shown on the screen in front of us here and online, together with the breakdown of the proxy votes that we've received.

2:25 It'll take a little bit of time to get the poll procedure completed, including the counting of the votes. And so the final results of the poll will be announced through our regulatory information service and published on the website as soon as practical. For those of you who are here in the room, you will be given a poll card. You have three options for each resolution. You can either vote for the proposed resolution or against the proposed resolution, or you may abstain from voting on the resolution. You may also withhold your vote. A vote withheld is not a vote in law and won't be counted in the calculation for the proportion of the votes for or against the resolution. When you have your poll card, please complete it by ticking the appropriate box next to the relevant resolution depending on how you wish to cast your vote.

3:18 And then when you've completed that, please sign the poll card, and I'll ask the company sector and and its team to collect those from you.

3:27 If you need any help with that, do ask. We'll be happy to help. So turning to the purpose of this meeting today, we have three ordinary resolutions requiring a simple majority in favor. The first resolution is the receipt and approval of the director's report and the audited financial statements of the company for the year ended 09/30/2021. The second one is the receipt and approval of the report on the directors' remuneration as set out in the audited financial statements for the year ended 09/30/2021. And thirdly, for the reappointment of Acatel Hudson as auditors of the company and to authorize the directors to determine their remuneration.

4:14 As I said at the beginning, we'll take questions on those resolutions first. So ordinary resolution, the receipts and approval of the report and accounts of financial statements. We haven't received any questions in advance of the meeting on resolution one. But if there are any questions, I'm very happy to take those now. No. No questions coming in? No questions from the room? Okay. Ordinary resolution two is the receipt and approval of the report of directors' remuneration set out in the audited financial statements. We have received two questions in advance on this resolution. Tim, could you summarize question one for me? Sure. So the first question is regarding salary costs. Salary costs have increased by 60% between 2020 and 2021.

5:03 But the narrative in the REMCO remains the same as the previous years. Is there a is there can you explain why this is the case, and has is there a change to remuneration policy? So I think we'll take this in in two parts. David, if you could talk about the remuneration policy as chair of the REMCO and perhaps Gary as chief executive, you could deal with the the more detailed part of the question. Okay. The policy itself has not changed for some time. It remains as it is. And, really, it's it's for the executive to work within that. Gary, perhaps talk about remediation plan and so on. Sure, David. Yeah. So as David says, the policy hasn't changed. The mix of our colleague base has changed. Historically, the business would have had almost all of its colleagues on an open ended salary in a BAU environment.

5:57 The challenges facing the business, as everybody knows, are somewhat different to a BAU environment, and their colleague base mix has changed to reflect that. What that means in practice is that we have more fixed term contract colleagues. They are employees. They're not consultants.

6:15 They are not contractors. They are, employees of the company, but are on a fixed term contract aligned to our remediation activity and our investment activity. And by the very nature of those types of contracts, people will require higher salaries. Where we have made hires on an open ended basis, and we have made some of those, our position is as it always has been that we pay salaries in line with the market rates. And as people know, market rates given the general employment market and and other macro issues are on a upward trend.

7:01 And also when we've made hires on an open ended basis, given the rather unique nature of where we are as a business, there has been a need to bring in experienced and senior people. And, clearly, the market rate for those people coming into a business in this position may be different to a more stable environment. But the overarching policies haven't changed. Excellent. Thanks, Gary. Much appreciated that. Tim, there was another question, I think. Yeah. Another question. On the report, says the 2021 report has exactly the same wording in respect of ad hoc recognition payments to employees and the same amount that previous year. Question, is that the correct amount employees full day September 2020?

7:49 And what that Remco thinks payroll payments to executive directors has on the business? So, David, would you like to take the point about the statement itself? And perhaps, again, Gary, you could talk about the impact on the business. Okay. I again, the policy hasn't changed in this previous period, and I can confirm that the executive directors did not receive any bonus payments in that term. The variable payments relates to the fact that there was an ongoing commitment to from the company to make these payments, which as the report states, passed an overall package. So that's relating to the executive directors. Would you like to come come and carry on the the variable payments, recognition payments that were made? Yeah. Sure.

8:45 We the the business undertakes a thirdly pulse survey across the business of colleagues' views on a number of issues. So we do that three times a year. We feed those comments into the board and back into the the colleague base, and and we work with our colleagues on any concerns that they have across a whole range of issues. The we get broadly a 90% feedback rate when we distribute those surveys. The the most recent one that we've done doesn't indicate that there has been any adverse reaction to the statements made in the annual reports.

9:37 So I think the question says, what does Remco think? I I I don't know if it's a I don't know if it's something for Remco to think. The the hard evidence coming out of our pulse surveys indicates that there has been no adverse reaction to these patients. Excellent. Thank you both very much. Jim, we got any more questions on resolution two? No. Okay.

10:01 So the third resolution to be voted on this morning is the appointment of McAdell Hudson as orders of the company and authorizing directors to determine the resolution of their remuneration. Don't believe we received anything in advance. We received anything today? No questions. No questions. Okay. Thanks very much. So having dealt with the questions, we'll now proceed to the vote by way of a poll. This means we won't go through the resolutions again, but we will ask shells present to complete their poll casts for the three resolutions. I declare the poll open. And just to remind you, the vote on each resolutions, please can you tick the appropriate box against the resolution for against or for extension, and then sign the poll card when it's complete.

10:53 How are we doing? We're good? Yeah. Thank you very much for collecting those in, company secretary's team. I declare the poll closed. As you can see on the slides in front of you now, I confirm that the proxy votes for resolutions you can see slide resolution one in front of you. The proxy votes are over 99%. Are we gonna put the other two up?

11:21 Resolution two is also over 99%, and resolution three, likewise. In that case, I'm going to declare the general meeting closed. As I said at the beginning, I did promise the board will be here to answer any general questions that shareholders might have. And we have had one general question submitted in advance of meeting. So, Tim, again, perhaps you could pose that for us. Based on the company's current overhead base, what size of portfolio of financial sequels does it need to be the 12% ROE for shareholders? How long will it take to get there? How much capital will you need to raise to get there? Great. Thanks, Jim. Caroline, would you like to have a go at that? Sure. So everything else equal based on where we are currently, then the balance sheet or the loans and advances would need to be around the billion level, that would take somewhere between 80 and 100,000,000 of capital.

12:20 In terms of time, it's it's dependent when that capital would be raised, but I think, you know, three to five years is a reasonable time frame. Okay. Thanks, Caroline. Tim, got any other questions? No further questions. No further questions. Okay. I think in that case, we are complete. Thank you very much, everybody, for attending the general meeting today. The meeting is formally closed, and I wish you all a good day. Thank you very much. Simon, that's great. And thank you very much indeed to the board for updating attendees online today. Could I please ask attendees online not to close this session as you'll now be automatically redirected for the opportunity to provide your feedback in order that the board can best understand your views and expectations. This may take a few moments to complete, but I'm sure it'll be greatly valued by the company.

13:08 On behalf of the board of PCF GROUP PLC, we would like to thank you for attending today's meeting. That now concludes today's session. So good morning to you all.