SCOTTISH broadcaster STV saw a major revolt against its executive pay report at its annual meeting in Glasgow yesterday, as its chief executive said the success of television series The Victim has sealed its return as a producer of quality drama.
Nearly 30 per cent of the voted shares went against a resolution calling for approval of the directors’ remuneration report for 2018, which saw Simon Pitts receive a pay package worth £1.5 million for its first year in charge of the Glasgow-based company.
The vote came after STV announced to the stock market that it expects total advertising revenue – across its national, regional and digital segments – to increase by one per cent to 2% in the period between February 28 and the end of May. And it said national advertising revenue will contract less steeply than previously forecast, with the company now expecting it to fall between 1% and 2% for the period. STV previously guided on a 5% drop in national revenue.
READ MORE: Saturday Interview: Telly addict Pitts backs STV against global giants
STV’s annual report for 2018 shows that Mr Pitts received total remuneration of £1.5 million for the year. The package included a salary of £400,000, annual bonus of £359,000 and a £645,000 of deferred shares, awarded as part of the buy-out package which secured his services from ITV.
Speaking after the meeting, Mr Pitts said he has received no inkling that shareholders are concerned over directors’ pay. Activist investor Crystal Amber is the biggest shareholder in STV with a 17.97% stake.
Mr Pitts said: “I speak to our shareholders all the time, as you might expect... and not once has anyone raised any issues around remuneration with me. What we talk about is what you’d expect us to talk about, which is the growth strategy for the business, [and] how we are delivering on it. The shareholders are supportive of what we are doing with the strategy. The results are starting to come through and long may that continue.”
All resolutions tabled were passed at yesterday’s annual meeting, though there was some opposition to the re-election of director of Anne Marie Cannon. Ms Cannon, a non-executive director with 35 years’ experience in the energy and banking sectors, saw 11.47% of the voted shares oppose her re-election. She has been on the board since 2014.
READ MORE: Profits fall at STV as boss backs it to thrive as independent
Mr Pitts said the growth strategy now being pursued by management is starting to bear fruit. In local advertising, he highlighted the success of the STV Growth Fund, which is enticing more small firms to advertise on television for the first time. And he said advertising sales are improving at a national level despite concerns over Brexit.
Mr Pitts said: “I think people were anticipating the first few months of the year to be more difficult, mainly because we were looking towards this end of March [Brexit] deadline.”
Mr Pitts signalled STV’s expectation of a strong second half, with the return of shows such as I’m a Celebrity... Get Me Out of Here and the Rugby World Cup in Japan in the autumn.
And he raised the prospect of STV producing a second series of The Victim, following the strong critical acclaim which met its first outing.
The drama, which starred Kelly MacDonald, John Hannah and James Harkness, was the first commission secured by STV from BBC One.
Mr Pitt said: “It is a format that can lend itself to returning series, so we obviously would like it to – that is down to the BBC.
He added: “We are delighted that it has found an audience, and is helping to put us on the drama map, because we hadn’t been making lots of dramas for ourselves or for others for a few years.”
The company reiterated its expectation of a 5% increase in its total dividend for 2019.
Shares dipped by 7.5p, or 1.96%, to 375p.
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