The Sanford fishing company routinely delivers tuna to Samoa canneries. Photo / Supplied
The Sanford fishing company routinely delivers tuna to Samoa canneries. Photo / Supplied
Moves by Sanford to raise the pay of its directors, despite falling profits and allegations of pollution, have caused outrage among the fishing company's shareholders.
The proposed increase to the pay pool from $400,000 to $550,000 a year, to be backdated to October 1, 2011, is listed as the lastresolution on the notice of annual meeting of shareholders. That meeting is to be held on January 25.
It has not been an easy year for the company. Net profit has dropped from $25 million in 2009-10 to $22.3 million in 2010-11, while competitors have reported increased profits.
Sanford was also indicted in the US on pollution charges after its vessel San Nikunau, which routinely delivers tuna to a cannery in American Samoa, was accused of discharging oily bilge waste into the sea.
Shareholder Mike Daniel said he was disappointed with the move, not only because he thought the company's performance did not warrant it, but because of what he perceived to be an attempt to hide the increase as the last item on the resolution list, which was sent just before Christmas, on December 20.
"In previous years they have sent those things out on December 16 ... I'm a bit disappointed, really."
He said the directors were not worth the pay rise because the company's share price had been abysmal. He said there had been plenty of capacity to increase the dividend the company paid to shareholders, but it had chosen not to.
Shareholders Association chairman John Hawkins said his organisation was not opposed to increases in pay for directors, provided they were warranted. He had examined Sanford's history since 2008 and found net profit had dropped 58 per cent and the return on equity was also down, while the chief executive's pay was up 27 per cent and directors' fees were up 26 per cent.
Sanford's chief executive, Eric Barratt, could not be reached for comment, but a spokeswoman directed inquiries to the company's annual report, which states that Sanfords' directors' fees are lower than the median levels of other publicly listed companies with market capital between $300 million and $600 million.
"The Sanford board fees pool was last increased in February 2008 (after a period of six years) from $250,000 to $400,000," the report says. "With the increase in the number of directors for whom fees are payable from six to seven, the base pool is automatically raised [to] $442,500.
"The board now proposes this pool be increased to $550,000, an increase of $107,500 or 24.3 per cent over the four years since 2008, to recognise the need to increase directors' fees to attract and retain suitably qualified candidates and to appropriately reflect directors' duties and responsibilities."
Hawkins had asked for an urgent meeting with the company's chairman to put forward a proposal for the company that he said might provide a better outcome. He did not want to say yet what the proposal was.
Hawkins said the timing of the release, just before Christmas, was unfortunate. "That's something we might discuss with the company as well. It's not giving people adequate notice."
Daniel said he would not usually attend the annual meeting but would do so this year to register his displeasure.
