Shareholders call for Sears boss to resign
Wednesday 26 June 1996
During heated exchanges at the company's annual meeting in London, chairman Sir Bob Reid and chief executive Liam Strong both faced calls to resign and had to battle against constant heckling from the floor. The chairman of the executive remuneration committee David Macdonald failed to regain election to the board as a non-executive director by a show of hands. The company had to employ its proxy votes from institutions to push the vote through.
Mr Macdonald had earlier tried to pre-empt shareholder unrest about boardroom pay by delivering a 15 minute description of the bonus scheme in a flat monotone. One shareholder was so frustrated that he walked out. "How long will this go on for?" another asked.
Shareholders were trenchant in their criticisms of Sear's performance: "This company has performed absolutely pathetically for the 30 years I have owned shares. We're not satisfied and we'd like to see someone else running the outfit."
Another commented that the 85th annual meeting of the company was a "sad meeting for shareholders". She added that the board "did not have the ability to run this company successfully."
She pointed to Sears' recent loss of pounds 120m compared with good trading figures from rivals such as John Lewis and Next. "If this is your best then I feel sorry for you. And Liam Strong should go."
Mr Strong has been the subject of much recent criticism over his handling of the sale of the Freeman Hardy Willis, Saxone and Curtess shoe chains to the Facia group which later collapsed. He sat silent yesterday, making no contribution to the meeting. All statements on current trading were made by the chairman.
Current trading figures, though poor, showed an improvement since the company's results announcement. Group like-for-like sales were flat in the 19 weeks to 16 June. Like-for-like sales were down by 5 per cent in the Freemans mail order business and the shoe chains. Selfridges comparative sales were up 11.5 per cent. Sir Bob also revealed that the new Selfridges branch in Heathrow Airport's Terminal One is "taking time to perform". "People are making money in that airport. Why aren't we?" he asked.
He said that Sears had conducted due diligence on Facia, which had satisfied the company of its viability.
While admitting that 1995/96 had been "a difficult year", Sir Bob said the streamlining businesses was commendable and that management was sound. Shares closed 1p higher yesterday at 100p.
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