Board of Directors

Stadium Group plc Annual report and accounts 201532

Nick Brayshaw OBE CEng, FIMechE, FRSA*Non-executive Chairman

Nick Brayshaw was appointed as a non-executive Director in April 2005 and Chairman in April 2006. He began his career with Rio Tinto plc and Caradon plc, before being appointed Group Chief Executive of Wagon plc until March 2004. He was an independent member of the Business and Innovation Group Board at the Department of Trade and Industry from 2000 to 2006 and Chairman of the CBI Manufacturing Council from 2003 to 2007. Nick is also Chairman of several private equity-backed companies: Worldmark International Limited, Kee Safety Group Limited, Eley Limited, CGI International Limited and Sentinel Performance Solutions Group Limited.

Charlie PeppiattChief Executive Officer

Charlie Peppiatt joined Stadium as Group Operations Director in October 2011 from Laird plc, a FTSE 250 global electronics company. He was appointed CEO of Stadium in June 2013.

Charlie was formerly Vice President of Global Operations for Laird Technologies with operational responsibility for a division with turnover of USD$400m and 6,000 staff covering eleven sites worldwide.

During 18 years with Laird plc, Charlie held other senior roles in the USA, Canada, Europe, India and Asia as VP of Operations (Mobile Antenna Systems), General Manager of Laird Technologies Beijing and Shenzhen, Operations Director of LSSD and Managing Director of Intron Ltd.

Joanne EstellChief Financial Officer and Company Secretary

Joanne Estell is a Chartered Management Accountant and joined Stadium in 2012 from Survitec Group Ltd, a marine safety and survival equipment manufacturer.

Previous to that she was Finance Director of Specialised Businesses for John Crane, the mechanical seals division of Smith Group, from 2008–2011. In that role she led the acquisition process of Orion Corporation in the USA and was responsible for providing a commercially focused finance function and integrating three newly acquired businesses into the Group.

Former roles include Financial Controller within the sealing solutions division at Smiths and she began her career in 1996 with hotel and restaurant group Whitbread plc.

Chris Gill ACA*Non-executive senior independent Director

Chris Gill is a Chartered Accountant and was appointed as a non-executive Director in April 2006. He is Chairman of the Audit Committee at Stadium Group.

Chris is currently a Director at Seanamic Group Ltd, Walker Filtration Limited and Banks Group Limited; previous roles include Finance Director of Wellstream Holdings plc and Domnick Hunter Group plc, and a number of senior international finance roles at Black and Decker.

* Audit, Remuneration and Nominations Committees.

Stadium Group plc Annual report and accounts 2015 33

UK Corporate Governance Code We do not seek to comply with the UK Corporate Governance Code and this is not a statement of compliance with the Code; however, the Board recognises that the UK Corporate Governance Code represents best practice for AIM-listed companies and regulates its activities with regard to the principles and provisions contained therein.

The Directors The Board of Directors, which leads and controls the Company, has a formal schedule of matters reserved for it and consists of:

— Non-executive Chairman

— Chief Executive

— Finance Director

— Non-executive senior independent Director

The Chairman and the senior independent Director provide the appropriate balance between the Executive and non-executive Directors for a company of this size.

The Board of Directors takes independent professional advice where necessary, at the Company’s expense. The Board meets monthly and the monthly management accounts and other relevant information are circulated to all Board members in advance of these meetings. The consolidated Group management accounts allow the performance of individual businesses to be monitored against budget, previous forecasts and prior year actual results.

Existing Directors are required to retire and submit themselves for re-election at least every three years or at the first Annual General Meeting (AGM) after appointment. The appointment of new Directors is delegated to a Nominations Committee, which makes recommendations to the Board.

Directors’ remunerationThe Remuneration Committee consists entirely of the non-executive Directors and its policy and the details of each Director’s remuneration are clearly explained in its report on page 36 and in Note 4 to the accounts.

A proportion of the Executive Directors’ remuneration is structured so as to link rewards to corporate and individual performance. The Board will consider every year whether the report of the Remuneration Committee should be an item on the AGM agenda.

Relations with the shareholdersAfter the announcement of the interim and final results the Directors meet the major institutional and private shareholders to discuss trading and future developments. The Board encourages all shareholders to participate at the AGM. Corporate news and financial information is provided on the Company’s website at www.stadiuminvestors.com.

Governance

Corporate governance

Stadium Group plc Annual report and accounts 201534

Internal controlThe system of internal controls established by the Directors is intended to be comprehensive, although the limitations of any system of control are such that it is designed to manage rather than eliminate the risk of failure to achieve business objectives and it provides a reasonable, rather than absolute, level of assurance against material misstatement or loss.

The principal features of the system of internal financial controls are:

— budgetary control over all operating units, measuring performance against pre-determined targets on at least a monthly basis;

— regular forecasting and reviews covering trading performance, assets, liabilities and cash flows;

— delegated limits of authority covering key financial commitments including capital expenditure and recruitment;

— identification and management of key business and inherent risks; and

— implementation and annual review of a Group compliance manual.

The Board continually reviews the effectiveness of other internal controls, including financial, operational, compliance controls and risk management.

Legislation in the UK concerning the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Audit Committee The Audit Committee, which comprises the non-executive Directors, meets to consider the scope and key issues in planning the external audit. The external auditor reports their findings and any recommendations to the Audit Committee prior to the approval of the financial statements.

By order of the Board

Joanne EstellCompany Secretary15 March 2016

Corporate governance continued

Stadium Group plc Annual report and accounts 2015 35

I present, on behalf of the Remuneration Committee of the Board of Directors, a report on Executive remuneration for the year ended 31 December 2015.

All matters relating to the remuneration of the Executive Directors are dealt with by the Remuneration Committee, which comprises the two non-executive Directors of the Company. The objective of the Remuneration Committee is to ensure that the Executive Directors are fairly rewarded for their contribution to the overall performance of the Group and that their remuneration is set in such a manner as to attract, retain and motivate suitable individuals with due regard to the effect upon the operating costs of the Company.

The Remuneration Committee considers all elements comprising Executive remuneration, including basic salary, annual performance related payments, benefits in kind, grants of share options and other longer term performance related remuneration, pension provision and period of contractual notice.

Basic entitlements The Executive Directors have service contracts which are subject to a notice period of six months.

The Executive Directors are each paid a basic annual salary which is open to review each January. In addition, the Executive Directors are entitled to annual performance related bonuses which are dependent upon the attainment of specific financial targets. Further benefits in kind are awarded as appropriate, including the provision of a company car and private medical insurance.

Pension provision The Executive Directors are entitled to have a contribution made by the Company towards a recognised pension scheme at a rate which matches their own contributions of 10% of their basic salary. The Executive Directors also benefit from death in service life insurance of four times earnings.

Share options and other long term performance related payments The Executive Directors are entitled to participate in the Performance Share Plan as approved at the Annual General Meeting in 2014.

Details of these options are set out on page 37 and in Note 17 to the accounts.

Non-executive Directors’ remuneration is determined by the Board as a whole and is set at levels intended to attract individuals of an appropriate calibre.

Details of Directors’ remuneration for the year ended 31 December 2015 are provided below.

Directors’ remuneration2015 2014 2013£000 £000 £000

Salaries, pensions and benefits in kind 657 479 742

Report of the Remuneration Committee on behalf of the Board

Governance

Stadium Group plc Annual report and accounts 201536

on behalf of the Board

Directors’ remuneration continuedDirectors’ remuneration comprised:

Benefits Total Total TotalSalary Bonus in kind 2015 2014 2013

£000 £000 £000 £000 £000 £000

Nick Brayshaw 65 — — 65 65 53

Joanne Estell 145 69 29 243 165 161

Chris Gill 37 — — 37 37 30

Tony Inskip (resigned 23 October 2013) — — — — — 200

Charlie Peppiatt 190 90 32 312 212 193

Stephen Phipson (resigned 1 June 2013) — — — — — 105

437 159 61 657 479 742

Joanne Estell and Charlie Peppiatt are members of defined contribution pension schemes (see Note 19 to the accounts) and the total Company contributions for the year were £33,000 (2014: £31,000). Pension contributions in respect of the highest paid Director were £19,000 (2014: £18,000). No pension contributions were paid on behalf of the other Directors.

No Director made any profit on the sale of share options exercised during any of the above years.

Nick Brayshaw OBE Chairman of the Remuneration Committee15 March 2016

Report of the Remuneration Committee continued

Stadium Group plc Annual report and accounts 2015 37

Principal activitiesThe principal activities of the Group are the provision of Technology Group Products and Electronic Manufacturing Services (EMS) to the professional electronics markets. The Technology Products include power products, interface and displays (HMI – human machine interface) products and M2M (machine-to-machine) wireless connectivity. Research and development in M2M wireless connectivity is also carried out as this sector is forecast for high growth. 33% of the Group’s revenue was serviced from its subsidiary operating in China. All other revenue was serviced from the Group’s UK sites of operation.

Results and dividendsThe results for the year are set out in the consolidated income statement on page 42.

An interim dividend of 0.9p (2014: 0.7p) per ordinary share amounting to £329,000 (2014: £217,000) was paid on 23 October 2015. The Directors recommend the payment of a final dividend of 1.8p (2014: 1.4p) per share amounting to £559,000 (2014: £435,000).

Directors and Directors’ interestsThe Directors of the Company during the year and their interests in the ordinary share capital at the beginning of the year or their date of appointment and the end of the year, all beneficial (and including related family interests), are shown in the table below.

31 December Options 31 DecemberOrdinary shares of 5p each 2015 Acquired Disposed of exercised 2014

Nick Brayshaw 169,052 6,325 — — 162,727

Joanne Estell 17,184 1,684 — — 15,500

Chris Gill 67,267 2,447 — — 64,820

Charlie Peppiatt 47,490 2,490 — — 45,000

Entitlements of the Directors at 31 December 2015 to purchase ordinary shares of 5p each under the share option schemes in Note 17 to the accounts were as follows:

Granted Granted Granted Granted20 October 21 October 22 September 25 March

Performance Share Plan 2011 2013 2014 2015

Exercise price 5p 5p 5p 5p

Joanne Estell — 185,000 120,000 80,000

Charlie Peppiatt 120,000 230,000 150,000 100,000

The market price of ordinary shares at 31 December 2015 was 108p and the shares traded in the range of 96.5p to 134.5p during the year. Full details of Directors’ shareholdings and options to subscribe are recorded in the Register of Directors’ Interests, which is open to inspection by members.

Directors’ indemnitiesThe Directors are entitled to be indemnified by the Company to the extent permitted by law and the Company’s articles of association in respect of certain losses arising out of or in connection with the execution of their powers, duties and responsibilities. As permitted by the Companies Act 2006, the Company has also executed deeds of indemnity for the benefit of each Director in respect of liabilities that may attach to them in their capacity as Directors of the Company. The Company also purchased and maintained Directors’ and officers’ liability insurance throughout the year.

Directors’ report

Governance

Stadium Group plc Annual report and accounts 201538

Directors’ report continued

Authority to purchase own sharesA resolution renewing the Company’s authority to purchase its own issued ordinary shares of 5p each will be proposed at the Annual General Meeting (AGM). This authority is limited to purchases through the London Stock Exchange at a price of not less than 5p per share and not more than 5% above the average of the middle-market quotations of the Company’s shares as shown in the Alternative Investment Market Daily Official List for the ten business days before the purchase is made, covering a maximum number of 5,479,064 shares being approximately 15% of the Company’s present issued ordinary share capital.

The Directors would not propose to exercise the authority to make purchases unless the expected effect of the purchase would be to increase earnings per share of the remaining shares in the capital of the Company and unless the purchase is generally in the best interest of shareholders. Any shares purchased under this authority would be treated as cancelled and the number of shares in issue reduced accordingly. The Directors presently intend that a resolution to renew this authority will be proposed at each succeeding Annual General Meeting.

Substantial shareholdingsAs far as the Directors are aware, the only notifiable holdings equal to or in excess of 3% of the issued ordinary share capital at 31 December 2015 were as shown in the table below.

Ordinary shares of 5p each Number %

Henderson Volantis Capital 6,562,441 17.97

Hargreave Hale, stockbrokers 3,900,280 10.68

Barclays Stockbrokers (EO) 2,192,908 6.00

AXA Framlington Investment Management 1,752,230 4.80

Hargreave Hale, stockbrokers (ND) 1,438,166 3.94

GD Fry 1,302,750 3.57

Close Brothers Asset Management 1,218,951 3.34

Treasury and risk management A review of treasury activities and risk management is set out in the Financial Review on pages 20 to 23 and in Note 15 to the accounts.

Payment of suppliers It is the Company’s policy to pay all suppliers within payment terms formally agreed on an individual basis. The average period of credit taken during 2015 was 63 days (2014: 63 days).

Donations The Group made charitable donations during the year amounting to £1,507 (2014: £1,097). No contributions were made to any political organisation.

Stadium Group plc Annual report and accounts 2015 39

Employees The Group actively encourages employee communication and involvement through representation by works committee and participation in schemes offering an element of performance related remuneration. In addition, the share option schemes outlined in Note 17 to the accounts offer employees the opportunity to benefit from the future development prospects of the Group.

It is the Group’s policy to give full and fair consideration to all applications from disabled persons, with due consideration being given to respective aptitudes and abilities. The same policy applies in the event of employees who become disabled during employment. Appropriate training is provided where applicable.

Going concernThe Directors confirm that, after having made appropriate enquiries, they have a reasonable expectation that the Group and the Company have adequate resources to continue operations for the foreseeable future. Accordingly, the Directors continue to adopt the going concern basis in preparation of the financial statements.

Events after the reporting dateNo significant events have occurred between 31 December 2015 and the date of authorisation of these financial statements.

Independent auditor A resolution to re-appoint BDO LLP as auditor of the Company will be proposed at the Annual General Meeting. So far as each of the Directors is aware at the time its report is approved:

— there is no relevant audit information of which the Company’s auditor is unaware; and

— the Directors have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditor is aware of that information.

This Directors’ report was approved by order of the Board

Joanne Estell Company Secretary15 March 2016

Governance

Stadium Group plc Annual report and accounts 201540

The Directors are responsible for preparing the strategic report, the Director’s report and the financial statements in accordance with applicable law and regulations.

Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the Group financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and have elected to prepare the parent Company financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law) including Financial Reporting Standard 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and Company and of the profit or loss of the Group for that period. The Directors are also required to prepare financial statements in accordance with the rules of the London Stock Exchange for companies trading securities on the Alternative Investment Market.

In preparing these financial statements, the Directors are required to:

— select suitable accounting policies and then apply them consistently;

— make judgements and accounting estimates that are reasonable and prudent;

— state whether they have been prepared in accordance with IFRSs as adopted by the European Union, subject to any material departures disclosed and explained in the financial statements; and

— prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company and the Group will continue in business.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements comply with the requirements of the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Website publicationThe Directors are responsible for ensuring the Annual Report and the financial statements are made available on a website. Financial statements are published on the Company’s website in accordance with legislation in the United Kingdom governing the preparation and dissemination of financial statements, which may vary from legislation in other jurisdictions. The maintenance and integrity of the Company’s website is the responsibility of the Directors. The Directors’ responsibility also extends to the ongoing integrity of the financial statements contained therein.

Statement of Directors’ responsibilities Stadium Group plc