The hotels and gaming firm Hilton Group yesterday joined the list of companies coming under fire for executive pay and contracts, as shareholders vented their anger by voting against key resolutions at its annual meeting .
The group, which also owns the Ladbrokes betting shops, was criticised in particular, for its remuneration policy. Investors owning 246 million shares, or 25 per cent of the company, voted against the remuneration report at yesterday's AGM. There were also 68 million abstentions.
A similar number of votes was cast against the re-election of the deputy chief executive Brian Wallace. Investors holding 230 million shares voted against that resolution, while investors holding 129 million shares abstained. Taken together, that equalled about 37 per cent.
One shareholder at the meeting also expressed anger that the company's chief executive, David Michels, remained on a two-year contract, which flies in the face of corporate governance best practice of one-year contracts.
Mr Wallace was also on a two-year contract until recently when he agreed to move to a one-year contract in return for £1.45m.
The opposition to the executive contracts came as Hilton told shareholders that profits for the first four months of the year to 30 April had plunged 25 per cent after the war in Iraq and the Sars virus hurt trading in its luxury hotels division.
Hilton, whose hotel chain has been under the cosh especially in London, Europe and the Asia Pacific region, said yesterday it thought demand would recover in the second half of the year. "Inevitably, the group has been adversely affected, particularly in April, by the Iraq war and Sars," it said, adding: "Looking ahead, our projections reflect a return to year on year revpar [revenue per available room] growth in late Summer."
The company said that since the war had ended, booking patterns had shown some improvement. Revenue per room in March and April fell 9.7 per cent including a 14.1 per cent drop in London, a 16.1 per cent fall in Europe and Africa and a 13.5 per cent slump in the Middle East and Asia Pacific.
The company also announced the appointment yesterday of Ian Livingston, BT's highly regarded finance director who was finance director at Dixons, as a non-executive director. Mr Livingston takes up the role on 1 June.
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