Paddy Power incentive plan could net executives up to eight times pay

Paddy Power shareholders will be asked next month to vote on an incentive plan that could pay executives up to eight times their basic salary from a pool of shares equalling 2 per cent of its capital.

And the publicly-quoted bookmaker made a one-off €280,000 lump sum payment to chairman Mr Stewart Kenny in 2002, bringing his total remuneration for the year to €513,000.

The company's annual report, published yesterday, shows his pension contributions rose from €42,000 in 2001 to €322,000 last year.

The remuneration committee report states that it decided to make a one-off payment to his pension in recognition of his contribution as chief executive. Mr Kenny stepped down from the post last year.

His replacement, Mr John O'Reilly, was paid a total of €514,000 last year and financial control Mr Ross Ivers received €459,000.

Paddy Power is planning to introduce a share-based incentive scheme for executive directors and other senior management. The plan will be put to the company's a.g.m. on June 3rd for shareholders' approval.

The scheme will allow the company to pay executives bonuses of up to eight times their basic annual salary in Paddy Power shares.

The bonuses will be drawn from a pool of shares purchased by a trust set up for the purpose. The pool will have a set maximum of 2 per cent of the company's share capital, or 47,000 shares. On last night's closing price of €5.10, that would be worth €5.6 million.

The scheme will operate between December 31st, 2002 and December 31st, 2007. Executives will have to reach at least 80 per cent of their targets to qualify.