Board backs down over pay
Shareholders force bonus cut on Johnston Press CEO
Shareholders have forced cash-strapped Johnston Press to cancel a planned increase in the bonus paid to its chief executive.
Despite the parlous financial position of the company, which owns The Scotsman and the ‘i‘ newspaper, the board intended to raise CEO Ashley Highfield’s bonus and pay it in cash.
It also wanted to increase the payout ceiling to chief financial officer David King.
London-based Johnston Press had planned to increase the top payout to 180% of Mr Highfield’s £430,000 salary, but under a new three-year remuneration policy this will be capped at 120%, still nearly half a million pounds.
Mr King’s maximum bonus will remain at 100%, against a proposed 165%.
Neither received a bonus last year after the company, which owns about 200 local papers, missed all its performance targets.
Mr Highfield’s total remuneration, including pension, was £556,000, plus share options with a face value of £537,500 that vest after three years.
The move by shareholders comes just a week ahead of the company’s annual meeting where the board may face further criticism.
Shareholders have been horrified by the company’s plunging stock market valuation which has left the company valued at just £15m amid fears that it will be unable to refinance its £220m bond debt.
Cash reserves have plummeted from more than £40m to just £16m last year.
Its biggest shareholder, the activist fund Crystal Amber, has called for Mr Highfield to be replaced and executive pay to be curbed.
The company’s adviser, Rothschild, is attempting to persuade bondholders to agreea restructuring that will convert some of the debt into equity.