CEO of troubled Rentokil rakes in £2.1m

The new chief executive of troubled pest control-to-hygiene group Rentokil received more than £2m (€2.9m) for just nine months work last year, it emerged today.

Doug Flynn earned a total of £2.15m (€3.1m) during the nine months to the end of December.

This was double the level of pay his predecessor received and came despite Rentokil’s profits falling by 17% during the period.

Mr Flynn’s pay packet was made up of a £600,000 (€868,000) basic salary and a £600,000 (€868,000) bonus.

On top of this he received a compensatory award of £800,000 (€1.1m) and benefits totalling £151,000 (€218,000), which included private health insurance, as well as the cost of legal and tax advice he took before joining the company.

In addition to this a company car and driver were also provided for Mr Flynn for business and limited private use at a cost of £42,000 (€61,000).

A total of £132,000 (€191,000) was also paid into the chief executive’s pension during the period – the equivalent of 22% of his basic salary.

He is also in line to receive up to 3.7 million shares in the company, which closed at 158.97p yesterday, paid over a number of years through a combination of a compensatory award and performance related initiative. He received the first tranche of these shares last week.

Mr Flynn was appointe on April 4 last year to turn around the struggling group after profits fell by 25% during 2004.

In January the group announced it was closing its loss making linen and workwear arm, putting 1,700 jobs at risk.

It had previously sold off its 29 UK conference centres to private investors for £325m (€470m) and recently announced it was auctioning its security division Manned Guarding.

But initial efforts to improve the group’s fortunes appeared to have failed, as in February it announced a 17% slump in profits for 2005, although it insisted its turnaround strategy was on track.

The firm said pre-tax profits fell from £304.6m (€441m) in 2004 to £252.9m (€366m) last year as it addressed “a set of deeply rooted problems” in its businesses.

But with revenues up nearly 5% to £2.29bn (€3.3bn), Rentokil said it was heading in the right direction and forecast profits would start rising again at the end of this year.

It will be particularly galling for workers to learn that nearly £500 a day was paid into Mr Flynn’s pension after Rentokil became the first FTSE 100 company to close its final salary scheme to existing mebers in December.