James Murdoch, BskyB's chief executive, saw his pay package jump by almost one quarter last year after he scooped his maximum bonus, despite profits at the satellite TV company barely moving.
The group's annual report, which was posted to shareholders yesterday, shows that Mr Murdoch, whose father, Rupert, is Sky's chairman, was paid a £1.65m bonus in the year to end-June. This was double his £825,000 annual salary, implying that the company smashed its internal performance targets.
Sky, which is facing an uphill battle to grow its revenues given that most of Britain already has digital TV, has failed to re-ignite its share price during Mr Murdoch junior's tenure. During its last financial year, its shares drifted.
Mr Murdoch, who succeeded Tony Ball as the group's chief executive in November 2003, took home £2.75m last year, up 23 per cent on his £2.23m package in 2005. He was also granted 382,500 share options, on top of the 450,000 he already held. Mr Murdoch, whose father's News Corporation media empire is Sky's biggest shareholder, can cash in his options next year if the company outperforms the FTSE 100 index.
Sky has 8.2 million subscribers but is expected to struggle to hit its target of 10 million by 2010. Last year, the group reported pre-tax profits of £798m, up 1 per cent from a year earlier, on revenues up 8 per cent to £4.15bn. The group's report states that bonuses for its executive directors are dependent on its earnings, free cash flow and subscriber growth.Reuse content