Ocado CEO gets £54m of £88m bonus scheme payout for bosses | Business
Four Ocado bosses are sharing an £88m windfall after a bonus scheme pegged to the online grocer’s share price paid out.
The company’s chief executive, Tim Steiner, was the biggest winner, raking in £54m, while the finance director, Duncan Tatton-Brown, and chief operating officer, Mark Richardson, both banked £14m. Luke Jensen, who runs its tech business, Ocado Solutions, got £6m from the scheme.
The men were handed the shares in 2014 under a five-year “growth incentive plan” which measured Ocado’s share price growth relative to the FTSE 100.
Once Steiner’s salary and other bonuses are taken into account his pay packet for 2019 added up to £58.7m. Last year Steiner, one of Ocado’s founding directors, was handed £4m. His shareholding in the company is worth £291m.
After making little progress initially, the company’s share price has rocketed over the past two years. The shares, which were changing hands for about 250p in November 2017, are now worth £12.34 after Steiner sold its grocery-picking expertise to numerous foreign supermarket chains. Ocado is now worth £8.6bn, largely because of the success of Ocado Solutions.
In the company’s annual report, the remuneration committee chairman, Andrew Harrison, said the executives were given a pay rise for 2020 to ensure they remained “motivated” to deliver long-term growth for shareholders. The details of their pay bonanza were published in the report.
The company reported an annual loss of £214.5m – up from a £44m loss the previous year – which it blamed partly on last year’s devastating warehouse fire in Andover, Hampshire. The details of the pay bonanza were published in its annual report.
Sales increased 9% to £1.8bn. The loss reflected £94m of one-off charges, the bulk of which related to Andover, which is now being rebuilt. While Ocado is fully insured, there is a time lag before it receives the full payout.
Ocado has seduced foreign supermarket chains, including Kroger in the US and most recently Aeon in Japan, with its robot-powered warehouses. It has now received orders to build 30 of them, with the first overseas depots due to open in Canada and France this year.
Last year Marks & Spencer paid £750m for 50% of Ocado Retail, the subsidiary that operates robotic warehouses in the UK. Ocado’s deal with Waitrose finishes at the end of August, when it will be replaced by M&S.
Ocado has claimed its product range will be bigger, cheaper and of better quality under the M&S deal.