While its new long-term incentive plan and future remuneration plan for its executive board were unanimously approved by shareholders at its AGM in Dublin, yesterday, current pay levels only passed with a 75% approval rate — meaning a quarter of shareholders were against the 72.5% rise in combined pay for Dalata’s three executive directors last year.
Chief executive Pat McCann; deputy CEO Stephen McNally and head of business development Dermot Crowley shared a combined €3.33m last year; up from €1.93m in 2015. On an individual basis, the three saw their pay packages increase by 78%, 69% and 68%. Mr McCann’s pay last year jumped from €840,000 to just over €1.49m.
Chairman John Hennessy said the group — which operates the Clayton and Maldron brands — takes a cautious approach to pay increases, measures them on a performance basis and is conservative compared to many of its peers.
However, he said 25% of shareholders voting against pay was concerning and something “we take seriously”.
However, he suggested that unanimous votes in support of the long-term payment policies suggested investors feel management is “doing the right things”.
Meanwhile, Dalata told shareholders that after a strong 2016, which saw profits rise 55% and revenues increase by 29%, trading performance for the first four months of 2017 was “marginally ahead of expectations”. Mr Hennessy said the board still intends to pay a maiden dividend to shareholders at some point in the future, but is not in a position to do so at the moment as the group’s capital investment programme is ongoing.
The group is looking to buy “two or three” leaseholds of Irish hotels it currently manages for other owners and is likely to close one or all of those transactions by the end of this year.
Beyond that, investment spend will now focus on its expansion in the UK where it aims to be one of the largest provincial hotel chains in the coming years and to have a presence in up to 10 cities within six years.
Mr. McCann said around 1,200 new rooms should open in each of the next three years, with the bulk of them being in the UK.
He said that would equate to the group opening about five or six new hotels per year.
Revenue per room for Dalata’s existing UK properties is ahead of forecast and the group said it is encouraged by the pipeline of potential opportunities.