Sainsbury’s CEO paid £583K bonus despite full year loss of £261m

Sainsbury's CEO paid £580K bonus despite full year loss of £261m
Sainsbury's CEO Simon Roberts has been in the job since last June.
// Sainsbury’s CEO Simon Roberts paid a £583,000 bonus in his first nine months
// He waived his annual bonus, but he was still paid a separate award based on long term incentive plan
// CFO Kevin O’Byrne was still paid an annual bonus on top of his long term incentive plan award

Sainsbury’s recently-appointed chief executive Simon Roberts was paid a £583,000 bonus in his first nine months on the job despite the grocer posting a £261 million full year loss.

It comes after Roberts told the Sainsbury’s board in November – amidst its interim trading update – that if an annual bonus was payable, he would waive his entitlement for the financial year due to the financial difficulties presented by the Covid-19 pandemic.

While Sainsbury’s annual report, published this week, indicated that Roberts did indeed waive his annual bonus, he was still paid a separate £583,000 award based around a long term incentive plan known internally as Future Builder.


READ MORE:


The annual report also stated that had Roberts opted for his annual bonus, that pay out would’ve been worth just under £1.04 million.

With Roberts’ fixed salary being £736,000, his total pay for the year ending March 6 – less than a year after he stepped into the chief executive role – was £1.32 million.

Roberts’ total pay was less than that of Sainsbury’s chief financial officer Kevin O’Byrne, who took home £2.32 million for the financial year ending March 6.

This comprised an annual bonus of £828,000, a long term incentive plan award of £674,000 and a fixed salary of £822,000.

“This year our business has been heavily impacted by Covid-19 and our chief executive, Simon Roberts, has made the personal decision to waive all of his annual bonus,” a spokesperson from Sainsbury’s told Retail Gazette.

“Chief financial officer Kevin O’Byrne has volunteered to take all of his annual bonus in deferred shares which will vest after two years.

“We are immensely proud of all of our colleagues who pulled together to navigate the crisis and we were pleased to award frontline colleagues three significant special recognition payments this year.”

Meanwhile former chief executive Mike Coupe, who exited in June last year to make way for Roberts, was handed a total pay packet of £1.43 million.

This was made up of a fixed salary of £451,000 and a long term incentive plan award of £985,000. Coupe was not paid an annual bonus.

Coupe’s total pay was also less than half what he earned the previous fiscal year – his last full year as Sainsbury’s chief executive – at £2.99 million.

Sainsbury’s remuneration committee chair Dame Susan Rice said factors including the performance of the business, its financial resilience and how business performance was impacted by Covid-19 were taken into account when deciding executive pay.

She also said Sainsbury’s decision to pay back business rates relief was also taken into account.

Sainsbury’s annual report also showed that chief executive pay was 122 times staff median pay for the full year, down from 173 times in the year before.

This was due to lower rewards at the top and extra “thank you” payments to staff, amounting to £800 for a full-timer.

The news comes several weeks after Sainsbury’s revealed in its full year trading update it had swung to a statutory loss before tax of £261 million – compared to profits of £255 million the year prior.

It attributed the loss to one-off costs and impairments associated with one-off restructuring announced last November, as well as write-downs of Argos assets.

On an underlying basis, Sainsbury’s profit before tax plunged 39 per cent year-on-year to £356 million, with benefits from strong sales growth more than offset by £485 million of direct Covid-19 costs – such as sick pay for shielding staff and extra safety measures to protect staff and customers.

While Sainsbury’s overall full year revenue remained fairly flat, like-for-like sales excluding fuel soared 8.1 per cent.

Click here to sign up to Retail Gazette’s free daily email newsletter

LEAVE A REPLY

Please enter your comment!
Please enter your name here