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Bowmer and Kirkland directors' pay falls from £20m to £10m in two years

Directors at family firm Bowmer and Kirkland have seen their payments halved in the last two years from £20 million to £10m, latest accounts reveal.

The figures were recorded as the construction firm and developer posted a 36 per cent hike in pre-tax profit after kick-starting several projects by providing the finance.

Group turnover increased six per cent to £708 million in the year to 31 August 2011 - including £682m in the UK - with profit before tax up from £32.6m to £44.4m. 
The firm was sitting on £200m of cash at the end of year, compared with £185m last time.

Bowmer and Kirkland came top of the directors’ pay table in the CNinsight100 list last year, with payments of £13.5m for 2010. The previous year had seen £20.3m paid to directors, with the highest paid director earning over £10m.  Profits fell that year, hit by wage costs as staff numbers also grew by 200.

In 2011, directors’ emoluments were £10.4m, with the highest paid director taking £4.8m, down from £5.5m in 2010.

2011 also saw a £4.3m dividend to shareholders.

Finance director Melvin Sheldon told CN:  “If you look at the period that we are talking about (2009) where it was particularly high, there was very little by way of dividend paid that year.

“The family takes money out of the business in various forms and most of it is profit related.”

Mr Sheldon rejected suggestions that high director payments might impact employee morale, pointing out that more than 150 staff have been with the firm for more than 25 years. Staff numbers in 2011 were flat at 1,471 (2010: 1,495).

Company profits were boosted by its strategy of investing its own cash pile into projects.

Mr Sheldon said:  “What we have done is enable a number of projects to go ahead by providing the finance as mezzanine or equity where the banks would have at one time said it was a good deal and backed it, but are reluctant to do so now. “

He said the company is looking to increase its investment portfolio through development opportunities, rather than acquisitions, as it continues consolidation of security service acquisitions in the US.

Mr Sheldon also told CN the firm expects a £750m turnover in 2012.

The company is a preferred contractor for Tesco and works with a number of the leading supermarkets.  Projects last year included Ocado’s £210m distribution centre and an £150m regeneration in Gateshead.

So far this year, it has been named preferred bidder for a £90m development at Centre Parcs and won an £120m scheme to transform the former Scottish Provident headquarters in Edinburgh into a luxury hotel.

Mr Sheldon also revealed to CN that he intends to step down from the FD role in August after 20 years. He will be replaced by an internal successor.

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