Cineworld was dealt a blow by shareholders at its annual general meeting, with more than a third rejecting its executive pay plans, even as the cinema chain had backed down on an earlier, more generous policy.
Of those voting at the meeting, around 34pc did so against the remuneration policy, which Cineworld said it had amended due to the “scale and complexity” of the business after its reverse takeover of US giant Regal Entertainment.
Under the new policy, which was passed by shareholders on Wednesday, chief executive Moshe Greidinger will receive a 9pc increase to his base salary, to £630,000, with the deputy chief executive to be handed a 28pc rise and chief financial officer 36pc.
Cineworld also proposed increasing the maximum annual bonus potential to 150pc of the salary, up from 100pc currently. It said it was not planning to increase the long-term incentive plan opportunity, but did intend “to utilise the maximum opportunity of 200pc of salary in future years”.
This would take boss Mr Greidinger’s maximum pay packet to above £3m, the deputy chief executive’s to £2.4m and chief financial officer’s to £1.9m.
The UK chain was already forced to back down on earlier remuneration plans last month, after shareholders fought back against a new bonus scheme, news that was first reported in The Sunday Telegraph.
Cineworld had been seeking to award its directors millions of pounds worth of shares, but this proposal was slapped down by investors as those shares, which directors would have been able to sell once the company’s stock had risen 10pc, had been linked to the Regal takeover, a deal which had wiped as much as 30pc off Cineworld’s share price.
Prior to the meeting today, shareholder advisory groups had warned the new policy had not gone far enough, with the Institutional Shareholder Services saying the Greidinger family already “have a significant stake in the business”.
It added it was “entirely justified to question the motivational impact of an additional 100pc of salary as bonus”.
Although Cineworld noted shareholders had approved the new policy on Wednesday, it said it also “recognises that a significant minority of shareholders voted against it”.
“The board believes that this new policy is fundamental in supporting the delivery of our strategy following the company’s acquisition of Regal Entertainment Group earlier this year. Notwithstanding this, the remuneration committee notes the concerns raised by shareholders, and will reflect on feedback received.”
It came as Cineworld received a boost from a strong film slate in the period from the start of the year to May 13, which included films such as Black Panther.
Revenues lifted 6.7pc on a constant currency basis in the period, with ticket sales having risen 6.1pc.