Dixons chief gets bonus despite mounting losses
Tuesday 19 July 2011
John Browett, the chief executive of Dixons Retail, has pocketed a cash bonus of £122,000 for the year just ended, despite the owner of Currys delivering a loss of nearly £225m.
The payout was unveiled in the pan-European retail company's annual report, in which chairman John Allan admitted he was "conscious that the group has made only limited progress in financial returns year on year".
Shares in Dixons Retail closed up by 0.6p at 15.9p yesterday, but remain a mile away from the 86p when Mr Browett joined in early December 2007.
Dixons Retail has been badly buffeted by the consumer spending downturn in the UK, but also in countries from Italy to Greece. But it is not alone, as the dire performance of rival Comet has forced its owner Kesa Electricals to put it up for sale, while Best Buy UK – the chain half-owned by Carphone Warehouse – has put on hold the roll out of its fledgling "big box" stores.
Mr Browett received pay of £1.03m, which included a salary of £676,000, £217,000 in equivalent pension contributions and a cash bonus of £122,000 for the year ending 30 April. However, this is more than a third lower than the total pay of £1.57m he received the previous year.
His cash bonus in 2010-11 was awarded for Mr Browett meeting "personal objectives" related to the group's transformation programme, which includes rolling out large "megastores" and improving its customer service.
A Dixons Retail spokeswoman said: "The cash bonuses awarded reflect performance against the renewal and transformation plan, which is delivering market share gains across most of the group's key markets, particularly in the UK and the Nordics."
In the UK, Dixons Retail has 31 Currys Megastores, which are often 2-in-1 combined Currys and PC World, and has a target of 70.
Indeed, Mr Browett's bonus for 2010-11 was actually down 82 per cent on the £670,000 he pocketed the previous year, when he got the maximum payout of 100 per cent of basic salary.
Nick Cadbury, the group's finance director, received total pay of £564,000, including a salary of £404,000, pension contributions of £84,000 and a cash bonus of £62,000. Mr Cadbury is leaving in September to joining the engineering group Premier Farnell and will be replaced by Humphrey Singer, the current UK head of finance.
According to Dixons Retail's own report, if someone had invested £100 in the company's shares on 30 April 2006 they would now be worth around £16, compared to more than £120 in the FTSE 350 index.
The troubles of Dixons Retail for the year to 30 April were primarily related to £309m of impairment and restructuring charges, notably from the closure of its operations in Spain and writedowns on its Greek business and online site Pixmania. This resulted in the group sinking to a full-year loss of £224m, on group sales of £8.34bn.
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