Saatchi makes dollars 6m pay-off
Wednesday 16 February 1994
Saatchi yesterday confirmed that he would receive a substantial pay-off, but would not take the money in a lump sum. 'It will be paid out over the long term,' the company said.
Mr Kennedy, who was not a main board director, was one of the five highest-paid executives in 1992, picking up almost dollars 800,000 in salary and other payments.
Official details of Mr Kennedy's pay-off will probably be included in Saatchi's report and accounts for 1993, traditionally released in late spring or early summer.
Mr Kennedy, who spent 33 years working in US advertising but only one as Saatchi's chief executive in North America, was viewed as one of the most powerful people in the agency's global empire.
Saatchi's shares rose 2p to 139p yesterday, but several advertising analysts were unaware of the pay-off. No formal announcement was made to the Stock Exchange.
The news comes amid speculation that Saatchi may warn its bankers that it is struggling to improve its financial performance.
Last weekend the Independent on Sunday revealed that confidential budgets prepared for Saatchi's bankers suggested it was unlikely to lift its underlying performance until at least 1995, which would further delay repayment of its estimated bank debts of pounds 160m.
Analysts have already started to lower profit expectations. Panmure Gordon, the broking house, has cut its prediction for 1994 from pounds 37m to pounds 32m, some pounds 4m below the consensus forecast in the City.
Analysts expect Saatchi to report underlying profits of pounds 19m for 1993. In 1992, it reported a pre-tax loss of pounds 577.4m after a pounds 600m write-off on goodwill reserves.
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