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Irish-Swiss Food Group withholds Boss's bonus

The Irish-Swiss food group Aryzta said that it had withheld the chief executive Owen Killian’s €877,000 performance-related bonus after a year of falling profits.

The global food group, which owns the Cuisine de France brand, has endured a difficult 18-month period during which its shares lost almost 50 per cent of their value.

Last week it reported a fall in its net profit of more than €18 million, to €312 million, while earnings declined by 5.7 per cent to €485 million in the year to the end of July.

It emerged yesterday that Mr Killian paid the price for the company’s disappointing performance with Aryzta’s annual report revealing the group’s decision to withhold his bonus “pending resumption of growth” in the group’s earnings per share.

Mr Killian’s compensation for the year came to about €1.42 million, despite the withheld payment. The chief executive earned a basic salary of about €1.17 million as well receiving benefits-in-kind worth about €76,000 and pension contributions of just under €176,000.

In a letter to shareholders, Denis Lucey, the departing chairman, attributed much of the company’s earnings decline to an increase in brand marketing of its Otis Spunkmeyer and La Brea ranges in North America. “The remainder of the margin decline related to the negative operating leverage from the long-term contract renewals,” Mr Lucey said, adding that “the successful finalisation of new long-term contracts brings revenue stability and a solid foundation for future growth.”

While the financial performance was weaker than anticipated, the company returned to revenue growth during the year.

The company last month announced the appointment of Gary McCann as Mr Lucey’s successor.

Source: www.thetimes.co.uk - 4 October 2016