SAINSBURY'S chief executive Justin King made £5 million in pay and share bonuses last year for helping to turn around Britain's third biggest supermarket group.
Alongside £2.05m in pay, pension and bonuses, King achieved all the targets set for him when he launched the recovery programme in 2005. This meant he qualified for 900,000 shares with a value of just under £3m, according to the company's annual repo
rt out yesterday.
His rewards will continue this year, as a further 831,000 shares vest under the same plan and 195,000 shares under a separate incentive scheme – worth a further £3.3m in total at the chain's current share price. Last month, Sainsbury's posted a better-than-expected 11 per cent rise in annual profits to £543m.
That performance triggered a bonus pot of £60m to be shared by Sainsbury's 120,000 staff, compared with a £47m pay-out in the previous year.
To qualify for his package, King has had to grow sales by £2.5 billion and earnings per share by 21 per cent over the four-year period – and both targets were met.
The chief executive also stands to benefit from further share awards in coming years, the annual report said.
He was last year granted a potential maximum of 630,876 shares worth £2.1m under its 2006 long-term incentive share scheme. These shares are set to vest in 2011, depending on performance.
Meanwhile, under a third incentive programme, the deferred annual bonus scheme, King invested 50 per cent of his bonus in 158,042 shares.
This will be matched by a further 316,000 shares by the company in 2011 – worth a further £1m – if Sainsbury's exceeds the performance of other retailers, including Tesco, Morrisons, Marks & Spencer and Next.
The supermarket group's shares closed up 3.25p yesterday, at 327.5p.
