Methven links hikes in directors' fees to meeting profit growth targets
Methven, the tapware and bathroom fittings manufacturer, says it will only hike directors' fees if the company increases its net profit by more than 20 percent.
"If we don't achieve the growth target, the directors' fees will remain unchanged," chairman Phil Lough said in an address to shareholders at its annual general meeting in Auckland. "This approach provides transparency and aligns directors' remuneration with returns to shareholders."
"In addition, we are also developing an executive incentive scheme with share price targets," he said.
Performance-based schemes with built-in growth targets will be introduced for the board and executive management team.
The Auckland-based company also affirmed its profit guidance for the 2012/2013 year.
"We expect to grow full-year net profit after tax and reduce net debt further," Lough said. "As a result of the current economic climate in the UK and only a marginal improvement in group net debt, we anticipate first half earnings to be down."
In May, its net profit rose to $6.5 million in the 12 months ended March 31, from $4.7 million a year earlier, at the lower end of its $6 million to $8 million guidance. Sales fell 13 percent to $106.2 million.
Shares in the company are up 2.4 percent and are currently trading at $1.28. The stock has gained 16 percent this year.
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