British retailer Sports Direct hit out at shareholders today for failing to back a lucrative bonus share scheme proposed for its founder Mike Ashley, as it posted a rise in fourth-quarter sales.
The sporting goods chain was forced to pull its latest proposal to award founder and majority shareholder Mike Ashley a bonus share scheme worth £73m after failing to gain enough support.
"The board was extremely disappointed to withdraw the resolution regarding a proposed share scheme award to Mike Ashley," Sports Direct chief executive Dave Forsey said in a statement.
"The most disappointing aspect was where large shareholders gave their support only to then vote differently. This outcome is likely to lead to further uncertainty in the future," he added.
The group, which has over 600 sports stores in Europe, including 400 in the UK, said today that total sales rose 10.3% to £360m in the nine weeks to March 30, with core sports retail sales up 11%.
Sales in its smaller fashion arm, which trades under store names including USC and Cruise, rose 0.7%.
The rejection of the bonus scheme sparked an eventful few weeks for Sports Direct, as shortly afterwards Ashley, who receives no salary or other bonus from Sports Direct, announced he had cut his stake in the retailer by 4% to 57.7%, causing a wobble in the firm's share price.
At the same time, the group also surprised investors by snapping up an 11% stake in Britain's House of Fraser while the department store was finalising a tie-up with China's Sanpower Group.
Sports Direct, whose raft of cut price label and own-brand offerings have proved popular with shoppers, said it was very confident of at least meeting its full-year core earnings target of £310m before staff bonus charges.