Guinness profits warning: Two company annual meetings focus on payments to executives

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The Independent Online
GUINNESS shareholders were yesterday warned to expect a profits fall for the first six months of this year.

At its well attended annual meeting the company also strongly attacked recent 'inaccurate comments' about the annual pension paid to Sir Anthony Tennant, who retired as chairman in December. Sir Anthony's pension, which the company declined to confirm, is said to be pounds 500,000 a year.

Sir David Plastow, chairman of the non-executive committee, said: 'When Sir Anthony joined Guinness it was contractually agreed that on his retirement he would receive a pension of two-thirds of his final pensionable remuneration. This agreement took into account the fact that he arrived at Guinness after 34 years of pensionable service with Grand Metropolitan and previous employers.'

He added: 'As part of the arrangements a sum of money, or pension transfer value, was paid into the Guinness pension fund from his previous company.'

Guinness shares, which were higher ahead of the afternoon meeting at the Royal Lancaster hotel in London, closed 7p down at 460p as the profit warning reached the City.

First-half profits in 1992 inched ahead from pounds 350m to pounds 353m and analysts were expecting a similar result this time. Downgrading of full-year expectations by analysts, who had been looking for between pounds 955m to pounds 980m, is expected today.

Prudential, the giant insurance group, also found the issue of executive pay high on shareholders' minds at its annual meeting yesterday.

In a dignified speech applauded by other shareholders, Tristram Burroughs complained that earlier criticism must have fallen on deaf ears since the pay received by Mick Newmarch, chief executive, had risen by pounds 152,000 to more than pounds 769,000 last year.

'The gravy train certainly runs on,' he added. 'I can only hope that the buffers are not too far down the track.'

While accepting that Mr Newmarch did not set his own salary, Mr Burroughs criticised remuneration committees made up of highly paid executives of other companies.

Mr Burroughs made a comparison with the 'shining example' of Sir Owen Green, whose many years at the top of BTR had seen profits rise from pounds 400,000 to pounds 1bn - yet Sir Owen's salary last year was pounds 217,000, 'a princely rise on the previous year of approximately pounds 800.

'One can only hope that this might be an example to follow by some of the extremely over-rewarded executives, not only in this company but in industry as a whole.'

Sir Brian Corby, Prudential's chairman, said he shared the concern about excessive compensation paid to departing managers who 'failed to deliver the goods'. But he rejected Mr Burroughs' appeal for a show of hands on Mr Newmarch's pay rise. The applause his remarks received indicated 'there are a lot of people in this room who share your views'.

(Photograph omitted)

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