Sports Direct boss Mike Ashley has said he doesn’t want any bonus next year.
The Newcastle United owner courted controversy when a contentious bonus shares scheme was voted through earlier this month even though it was rejected by major shareholding bodies such as Association of British Insurers.
The plan would have granted 25 million shares worth around £180m to Ashley, as well as bonuses to 3,000 staff.
But Sports Direct this morning said that Ashley, after discussion with the remuneration committee, had told the board that he does not wish to be rewarded under the 2015 bonus share scheme.
Ashley has further said that while the 2015 scheme – which relates to the financial period up to April 2019 – is in place he does not expect any other share-based incentive scheme to be proposed to shareholders in relation to his role as an executive director of Sports Direct.
Non-executive chairman Keith Hellawell said: “The resolution passed by shareholders to implement the 2015 bonus share scheme clearly recognises the success of previous company-wide schemes, and the significant contribution from Mike.
“On behalf of the entire board, I should like to thank shareholders for the trust and confidence that they have demonstrated towards the team. Mike remains fully committed to achieving the scheme’s stretch targets.
“Regarding the allocation of shares, Mike’s focus is on ensuring that the scheme aligns all employees to achieve the company’s objectives. Following recent unhelpful speculation surrounding his potential allocation, he is determined to ensure that there is the maximum number of shares available for the eligible employees.”
Under the Sports Direct new bonus scheme, underlying earnings will have to hit £480m in 2016, £570m in 2017, £650m in 2018 and £750m in 2019.
Some shareholders are said to be planning to vote against chairman Keith Hellawell, remuneration committee chairman Dave Singleton and other directors at the annual meeting in September because they feel the board demonstrated weak leadership over this matter which has dragged on for two years.
Meanwhile, Sports Direct this week announced it was to open three shops in Australia and one in New Zealand, adding to the 400 outlets it currently has in the UK and Europe as part of an online partnership with OzSale.com.au.
This is part of the MySale Group in which Ashley acquired a 4.8% stake, worth around £15m, last month.
As Australia’s and New Zealand’s most successful online flash sales fashion retailer, MySale will operate the e-commerce platform as part of a new joint venture, giving Sports Direct immediate access to its 12 million members.
Sports Direct’s preliminary results for the 2014 financial year will be announced tomorrow.