Redfern rewarded despite £604m pre-tax loss; Persimmon’s Mike Farley takes home extra £400,000
Peter Redfern, the chief executive of Taylor Wimpey, has been rewarded with a £788,000 bonus for pulling off the housebuilder’s marathon refinancing deal.
Redfern, 39, completed 10 months of negotiation over the housebuilder’s former £1.9bn debt pile last April. His total pay for 2009 was £1.7m, including his maximum possible bonus, even though the firm made a pre-tax loss of £604m.
Redfern’s windfall came in the same week that Mike Farley, chief executive of Persimmon, received a £406,000 bonus. He was paid a total of £1.3m for “cash generation”, despite the firm laying off more than 2,000 staff since 2008, paying no shareholder dividend and making just £7m in pre-exceptional profit (see graphic, below).
Other housebuilders have yet to reveal their bonuses.
The amounts are expected to raise eyebrows among shareholders, although nobody is forecasting the level of revolt that Bellway encountered last year after it paid bonuses based on retrospectively altered criteria.
Robin Hardy, an analyst at KBC Peel Hunt, said: “There’s clearly an issue here with executives in this sector taking advantage of things other than profit.”
Another analyst said: “Redfern was a financial director at George Wimpey, which is at the root of a lot of these problems. Should you really be rewarded for fixing a problem you were the architect of?”
On Persimmon, another analyst said: “I think it is a fabulous company, but everything’s about timing. Even if you’re entitled to a bonus, don’t take one for 2009. It’s taking the piss.”
The bonuses will have to be agreed by shareholders at Persimmon’s annual general meeting on 22 April and Taylor Wimpey’s on 29 April.
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