$5.5m payday for retiring head

By PETER GRIFFIN

The former head of Lion Nathan earned A$5 million ($5.5 million) in his last year with the brewer, including an A$3.1 million payment for hitting long-term profit targets.

Gordon Cairns stood down as Lion's chief executive at the end of September to make way for Nestle executive Rob Murray, a member of the Lion board for two years.

Lion's weighty annual report pays tribute to 54-year-old Cairns, who chairman Geoff Ricketts said had achieved his objective of transforming the company.

"Under his leadership, Lion Nathan's market capitalisation has doubled and over the last five years shareholders have received total returns of 21.3 per cent compound," wrote Ricketts in the annual report.

A large portion of Cairns' pay was linked to net profit figures and the performance of Lion's share price.

On both counts the brewer, which has a large share of the Australasian liquor market but this year sold its Chinese brewing assets, has been doing well.

Profit before unusual items in the form of writedowns and the China sale in the September year was A$202.7 million, up from A$180.1 million in the previous year.

Lion was able to exit China with a profit on the sale of brewing assets of A$104.1 million, no doubt saving Cairns from criticism for leading an unsuccessful foray into Asia.

At the end of September, Lion's share price was A$7.38, up from A$5.35 a year earlier. The full-year dividend increased A2c to A29c.

The 2003 report shows Cairns earned around A$4.1 million for the year, including A$2.1 million as a long-term incentive allocation.

Lion managing director Andrew Reeves picked up A$2.5 million in the year to September and Ricketts himself pocketed over A$1 million, mostly in accrued retirement benefits.

Cairns steps down from the Lion board at the company's annual meeting on December 15.

Ricketts said Lion was engaged in the "time-consuming" job of finding a new non-executive director to fill Murray's old non-executive board position.

Lion has 13,772 shareholders, up from 11,335 a year ago.

Previously, about 63 per cent of Lion's shareholders were in New Zealand. That is now down to 50 per cent.

The largest holders of Lion shares are Japan's Kirin Brewery, with 46 per cent, and Australian managed funds. Lion employs 2800 people, down from over 4000 last year.