The following section provides details of the remuneration, pension and share plan interests of the Directors for the year ended 22 March 2008 and has been audited.
i) Directors’ remuneration
The remuneration of the Directors for the year was as follows:
| Note |
Salary/fees £000 |
Bonus 3 £000 |
Pension supplement 4 £000 |
Benefits 5 £000 |
Total 6 2008 £000 |
Total 6 2007 £000 |
|
|---|---|---|---|---|---|---|---|
| Justin King | 1, 7 | 850 | 1,042 | 255 | 29 | 2,176 | 1,921 |
| Darren Shapland | 500 | 429 | 97 | 16 | 1,042 | 919 | |
| Mike Coupe | 2 | 311 | 302 | 71 | 10 | 694 | – |
| Philip Hampton | 395 | - | - | 1 | 396 | 396 | |
| Anna Ford | 60 | - | - | - | 60 | 43 | |
| Val Gooding | 50 | - | - | - | 50 | 10 | |
| Mary Harris | 2 | 33 | - | - | - | 33 | – |
| Gary Hughes | 60 | - | - | - | 60 | 54 | |
| John McAdam | 60 | - | - | - | 60 | 55 | |
| Bob Stack | 60 | - | - | - | 60 | 55 | |
|
Payments made to Directors who left the Board before the start of the financial year |
54 | ||||||
| Total 2008 | 2,379 | 1,773 | 423 | 56 | 4,631 | ||
| Total 2007 | 1,824 | 1,365 | 246 | 72 | – | 3,507 |
- Highest paid Director.
- Appointed to the Board on 1 August 2007.
- Includes performance bonuses earned in the period under review but not paid in the financial year ended 22 March 2008.
- Justin King is not a member of the Company pension schemes and received 30 per cent of his basic salary as a cash pension supplement. In addition to this supplement, £4,000 (2007: £4,000) of interest has been earned on a notional fund during the year from his previous membership of the Executive Stakeholder Pension Plan. Mike Coupe is not a member of the Company pension schemes and received 25 per cent of his basic salary as a cash pension supplement. Darren Shapland is a member of the Executive Stakeholder Pension Plan. Contributions to the Stakeholder Plan by the Company in 2007/08 in respect of his membership were £14,100 (2007: £13,575). He received a cash pension supplement equal to 25 per cent of the amount by which his salary exceeded the Company’s earnings cap (2007: £112,800).
- Benefits include company car benefits and private medical cover.
- The totals for 2007 and 2008 (in the case of Darren Shapland) do not include deductions made from basic salary for Saving Money and Reducing Tax (“SMART”) pensions.
- The Company allows Executive Directors to take up one non-executive role outside the Company subject to a consideration of the role and the time commitment. Directors are entitled to retain the fees earned from such an appointment. Justin King was appointed a Non-Executive Director of Staples, Inc. on 17 September 2007 and received US $43,750 for his services during the year. He also received from Staples, Inc. 6,414 restricted stock units which vest between March 2009 and December 2010. In addition he received 48,199 Stock Options, 16,699 of which vest in March 2009 with the remainder vesting 25 per cent per annum.
ii) Long-term incentive plans
Performance Share Plan
Under the Plan, shares conditionally allocated to participants are released to them in the form of options if the performance condition is met at the end of the three-year performance period. The number of shares conditionally allocated in 2004 is shown below. No allocations were made from 2005/06 and the Plan is now closed.
| Number of shares conditionally allocated as at 24 March 2007 | Lapsed during the year | Number of shares conditionally allocated during the year | Mid-market price on date of conditional allocation pence | Options granted during the year under the Plan | Mid-market price on day option granted pence | Number of shares conditionally allocated as at 22 March 2008 | End of performance period | ||
|---|---|---|---|---|---|---|---|---|---|
| Justin King | 20.05.04 | 184,762 | 36,952 | – | 274.0 | 147,810 | 558.0 | – | 24.03.07 |
The above figures for the 2004 award show the maximum award that would have been released provided that the Company achieved first position within the comparator group (namely Ahold, Alliance Boots, Carrefour, Casino, DSG International, Kingfisher, Loblaw, Marks & Spencer, Morrisons, Next and Tesco), at the end of the three-year performance period. Shares to the value of 30 per cent of salary would have been released at median performance. Awards were granted on 16 May 2007 and pro rated at the relevant position between the median and first position in the comparator group. The Company’s relative performance was determined by reference to TSR, being the increase in the value of a share, including reinvested dividends, over the three-year period. This measure was chosen to incentivise participants for maximising shareholder return over the medium-term.
The following table shows the options that were granted in May 2007 as a result of the partial satisfaction of the performance condition attaching to the conditional allocation awarded in 2004.
| Number of options 24 March 2007 | Number of options granted during the year | Number of options exercised during the year | Mid market price on date of exercise pence | Gains on option exercises £000 | Lapsed during the year | Number of options 22 March 2008 | Total exercise price pence | Date from which exercisable | |
|---|---|---|---|---|---|---|---|---|---|
| Justin King | – | 147,810 | 147,810 | 558.0 | 825 | – | – | nil | – |
Justin King retained 30,000 shares arising out of this release.