£8m pay packet for Sainsbury's boss

Sainsbury's boss Justin King earned a total pay package of almost £8 million last year as his efforts to revive the supermarket chain continued, the firm's annual report showed today.

Mr King's bumper package consisted of £3.35 million in salary, bonuses, benefits, pension contributions and deferred share awards, the report said.

He also made a £4.52 million gain on share options from long-term incentive schemes - including a maximum payout under the 'Making Sainsbury's Great Again' incentive plan to revive the fortunes of the group, which he joined in 2004.

His overall package is up 60% on the previous year's £4.9 million although the group's remuneration committee said it had been "mindful of the current economic climate" in freezing basic salaries for the grocer's executive directors.

Finance director Darren Shapland also picked up a £1.54 million package as total boardroom pay and deferred share awards reached £7.1 million, the figures showed.

Mr King has overseen a recovery of the chain during the past four years - with underlying pre-tax profits more than doubling from £244 million in 2006 to £610 million in the current year - in a period which saw the firm twice become a takeover target in 2007.

The 17% rise in annual profits was better than expected by the City while the group's 127,000 staff shared a record bonus pot of more than £80 million.

UK like-for-like sales growth slowed to 4.3% last year as the impact of food price inflation fades away and competition intensifies, but Sainsbury's is now looking for growth in other areas.

The supermarket spent £900 million over the year to add 1.1 million sq ft of selling space, as well as opening or extending more than 100 stores, but plans to increase its convenience stores format as well as further growth in non-food sales.