Materials science company Cookson became the latest company to see a substantial proportion of shareholders vote against the executive pay package at its annual general meeting (AGM).
Almost 32%, or 70.5m, of the 220.8m votes cast at the AGM were against the motion to approve the directors' remuneration report.
At the AGM, the Chairman Jeff Harris said: "The board continues to listen very carefully to views expressed by shareholders and will be taking these into account along with the result of today's vote on the Remuneration Report, as remuneration policy is formulated going forward and we develop future policies."
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The shareholder rebellion came despite a well-received interim management statement from the company which revealed that trading in the first four months of the year had been in line with expectations.
Group trading profit was slightly ahead of the equivalent period of last year and management's expectations for the full year performance in 2012 remain unchanged.
What really seemed to excite the market, however, was the possibility of Cookson splitting itself in to two.
The board has instigated a strategy review to consider a number of options for the group. These options include a potential demerger or separation of Cookson's main divisions, given the limited operational or end-market overlap between the Engineered Ceramics division (a ceramic refractory business) and the Performance Materials division (a speciality chemicals business).
An initial analysis of what Cookson termed "the frictional costs" associated with any separation has been carried out, and initial indications are that the the likely upfront, one-off cash costs of any separation would be in the range of £50m to £70m.
"The level of on-going, incremental costs to the businesses resulting from any separation will continue to be assessed, but the net present value of these costs (which includes additional head office and taxation costs) is currently expected to be broadly similar to the level of the upfront cash costs," the statement said.
In the Engineering Ceramics division, the performance in the first half is expected to be marginally below that seen in the first half of last year, due to the relatively weak performance of the Fused Silica business.
It is a different story in the Performance Materials division, where continued strong performance in the Americas and Asia-Pacific has more than offset weak end-market conditions in Europe. As such, the division's first half performance is expected to be well ahead of the equivalent period last year, but slightly below the seasonally stronger second half of 2011.
The outlook for the remainder of 2012 remains in line with that stated in the group's results announcement at the end of February.
The shares were up 37.5p to 681.0p towards the end of the lunch-time trading session.
JH
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