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Henry Boot PLC Annual Report and Financial Statements for the year ended 31 December 2015 www.henryboot.co.uk Stock Code: BHY Governance Directors’ Remuneration Report continued Summary of bonuses earned for 2015 Measure Profit before tax 110% Maximum award as % of salary Targets and bonus potential for 2015 Actual performance Actual bonus value achieved (% of salary) % of target 2015 target range Bonus payable as % salary Jamie Boot John Sutcliffe 90% £22.5m 10% 100% £25.0m 50% 120% £30.0m 90% 150% £37.5m 110% £32.4m 96.4% 96.4% Personal objectives 10% See commentary below 9% 9% Bonus amount achieved as % salary 105.4% 105.4% Bonus amount earned £385,002 £262,774 Maximum bonus as % salary 120% 120% Bonus amount achieved as % maximum 87.8% 87.8% Bonuses were paid in line with the Directors’ Remuneration Policy approved at the AGM in May 2014. Target profit was set at £25m, 25% ahead of the target set in 2014. The Remuneration Committee also set 18 individual targets, which were the same for Jamie Boot and John Sutcliffe. These covered financial measures such as the achievement of individual subsidiary budgets, cash flow generation and health and safety, environmental and Investors in People measures, a measure related to positive investor feedback, and litigation risk. The Remuneration Committee considers that the Directors achieved 90% of these targets resulting in a bonus of 9% of salary. The profit before tax of £32.4m exceeds the target by 29.6% and this, combined with the personal targets, gives rise to a bonus of 105.4% of salary for the year ended 31 December 2015. Details of the policy for future annual bonus awards can be found in the Directors’ Remuneration Policy which can be viewed, and downloaded, on the website: 31 December 2016 bonus targets Profit before tax performance: 10% of salary payable on 90% of Group profit target, rising to 90% of salary payable upon the achievement of 120% of Group profit target. If, in exceptional circumstances, profit targets are exceeded by more than 20%, a further bonus of 20% of salary may become payable up to 150% of target. The profit before tax target is deemed to be commercially sensitive and therefore will be disclosed retrospectively in the 2016 Directors’ Remuneration Report. Personal objectives: up to an additional 10% of salary may become payable to Executive Directors upon the achievement of personal objectives. The objectives measured will be based on key elements of the delivery of Group strategy. www.henryboot.co.uk/about-us/governance 68
Henry Boot PLC Annual Report and Financial Statements for the year ended 31 December 2015 www.henryboot.co.uk Stock Code: BHY Long Term Incentive Plan (LTIP) The Committee has reviewed the performance criteria for the LTIP shares awarded in 2013, based on performance for years 2013, 2014 and 2015, which are expected to vest in May 2016. The LTIP shares in this award are subject to the following performance criteria: 1. profit growth was 143%, which exceeded RPI growth by more than 137%. This was greater than the requirement to exceed RPI growth by 12% and therefore this 50% of the award became eligible; 2. adjusted NAV growth was 32%, which exceeded the industry standard investment property annual index growth by just over 2%. As a result of this 43% of this 50% of the award became eligible; 3. Total Shareholder Return (TSR) compared to the comparator group showed that Henry Boot PLC TSR for the three-year period was 83%, putting it below the median within the comparator group. Therefore, the awards above are reduced by 50% which gave rise to the award values in the single total figure of remuneration at 31 December 2015 on page 66. This gave rise to LTIP awards of: Jamie Boot 64,740 shares; and John Sutcliffe 48,974 shares. LTIP awards granted in the year Face value to grant at £2.286 per share % of award vesting at threshold Type Number of award % of salary of shares Jamie Boot LTIP – nil cost option 100% 159,789 365,277 25% John Sutcliffe LTIP – nil cost option 100% 109,060 249,311 25% The performance conditions which must be satisfied to enable the receipt of these grant awards are disclosed below. Awards expected to be granted for the financial years 2016–2018 in 2016 % of Type award at of award % of salary threshold John Sutcliffe LTIP – nil cost option 100% 25% Darren Littlewood LTIP – nil cost option 100% 25% The performance criteria for these awards are laid out in the Remuneration Policy which can be viewed, and downloaded, on the website: www.henryboot.co.uk/about-us/governance These are different from the performance criteria for previous awards made in 2013, referred to above, as follows: EPS growth Return of Capital Employed Total Shareholder Return (TSR) relative to our comparator group We strive to grow earnings per share faster than inflation. This should give rise to an ability to grow dividends faster than inflation, a key driver to long-term growth in shareholder value. We strive to achieve a 10% profit before tax return on balance sheet net assets. This should give rise to at least two times dividend cover, thereby generating growth in the Group’s retained capital to reinvest and grow. This is a further driver to long-term shareholder value growth. We strive to achieve high shareholder returns. TSR reflects the extent to which shareholders and the market consider that the Company strategy is appropriate and is being implemented and articulated well by the Executives. The detailed performance metrics for LTIPS awarded from 2014 onwards to be granted in 2017 onwards are: % linked Threshold vesting of 25% Threshold for 100% to award of maximum award of maximum award EPS growth 33.3 RPIJ + 3% per annum RPIJ + 7% per annum Return on Capital Employed 33.3 Average three-year Average three-year ROCE of 10% ROCE of 13% or more TSR 33.4 TSR at median or above our comparator group TSR at or within the upper quartile Shareholder Information Financial Statements Governance Strategic Report Overview 69
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Cohesive Consistent Confident

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