12th Jul 2006 07:00
Sainsbury(J) PLC12 July 2006 12 July 2006 J Sainsbury plc 2006 AGM Statement In his opening remarks today at Sainsbury's AGM, Philip Hampton, chairman, willintroduce the changes to the Board since the last AGM to attending shareholders.This includes the appointment of Darren Shapland, chief financial officer, JohnMcAdam as senior independent director, and Anna Ford as a non-executivedirector. In addition Philip will confirm that, as previously announced, BridgetMacaskill, non-executive director will step down today. Commenting on the results for 2005/06 Philip will say, "At last year's meeting Isaid how I believed that Sainsbury's, with its passion for food, it's history ofquality and innovation and its strong ethical approach, was a company worthfighting for and I think our performance over the last financial year hasincreased confidence in our prospects among customers, colleagues and, Ibelieve, among shareholders as well". The proposed dividend is 5.85 pence per share, taking the full year dividend to8.00 pence per share, up 2.6 per cent, broadly in line with inflation. Dividendcover, the measure that indicates a company's ability to pay the dividend, nowstands at 1.3 times and the objective remains to restore it to 1.5 times. The plan to Make Sainsbury's Great Again requires an improvement in the customeroffer and a recovering sales performance. To date, including sales growth so farthis year, the company has now delivered £1 billion towards the £2.5 billiontarget and it is expected that over the next 12 to 24 months improved salescoupled with reduced costs will drive improved profitability. While the plan ison track and a good start has been made it is recognised that there is stillmuch to do. A new incentive framework will be put to the meeting. The Board believes thatincentives are vital to the delivery of results and that those results should beclosely linked to the interests of shareholders. The 2006 Long Term IncentivePlan is designed to retain key talent for the future, including 1,000 seniormanagers and all supermarket store managers, for the long-term success of thebusiness. The targets require increased return on capital employed and growth incash flow per share as detailed in the Notice of Meeting. A new Deferred AnnualBonus Plan is also being proposed for the most senior management. The planencourages them to build a shareholding in Sainsbury's and provides rewards iftotal returns to shareholders exceed those of the competitors. Justin King, chief executive, will present the operational and financial resultsfor 2005/06, highlighting total sales growth (excluding petrol) of 5.8 per cent(3.7 per cent like-for-like), the delivery of £110 million of cost savings,which resulted in an increase in underlying profit before tax (2) of 12.2 percent. At the preliminary results in May 2006, we indicated our intention to put inplace plans to accelerate the store development programme and increase theopening of new store space. Sainsbury's is pleased to announce that it hasagreed to acquire the first, a 35,000 square foot sales area, food focused storein Urmston, Manchester. It is part of a major town centre redevelopment andexpected to open in 2008. Sainsbury's is increasingly delivering 'great food at fair prices' and thecompany's heritage and considerable strength in providing healthy, safe andfresh food is increasingly important to consumers, as they become more concernedabout the quality, sourcing and integrity of the food they eat. Sainsbury's 'Wheel of Health' nutritional labelling has been well received and is enablingcustomers to make more informed decisions on the products they buy. In closing the AGM, Philip will say, "I thank you for your continued support andfor attending. I hope that we will see you at the Sport Relief run this weekendor in our stores supporting Sport Relief". Enquiries: Investor Relations Media Lynda Ashton +44 (0) 20 7695 7162 Pip Wood +44 (0) 20 7695 6127 Notes 1. The AGM will take place at 11:00am on 12 July 2006 at The QEIIConference Centre, Broad Sanctuary, Westminster, London SW1P 3EE. 2. Underlying profit before tax is Profit before tax from continuingoperations before any gain or loss on the sale of properties, impairment ofgoodwill, financing fair value movements and one off items that are material andinfrequent in nature. In the current financial year, these one off items werethe Business Review costs, IT insourcing costs and debt restructuring costs. Inthe prior financial year, the one off items were the Business Review andTransformation costs. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Sainsbury's