Warhammer maker Games Workshop has suffered a major shareholder revolt after handing millions in bonuses to its top bosses.
The Nottingham-headquartered company saw almost 21 per cent vote against its remuneration report and nearly 27 per cent vote against its remuneration policy at its AGM today (Wednesday, 18 September).
Following record sales and pre-tax profit for the listed business, Games Workshop handed its chief executive, Kevin Rountree, a bonus worth 150 per cent of his base salary.
Its chief financial officer, Rachel Tongue stepped down from her role after 27 years at Games Workshop at the AGM and is to be succeeded by Liz Harrison, also received the same percentage bonus.
Rountree has a total pay packet of £1.87m which is made up of £787,000 in fixed pay and the same amount linked to targets.
The committee agreed to award both the CEO and CFO an annual increase in base salary of 7.4 per cent from 1 January, 2024.
The bump came after executive directors did not receive a base pay annual increase in 2021/22 or in 2022/23.
Under the firm’s policy, each executive director must use 67 per cent of the 150 per cent bonus to buy shares in Games Workshop after tax and hold them for at least three years.
Games Workshop’s remuneration policy was first approved by its shareholders in 2021 and remained unchanged since.
Games Workshop ‘can’t pay as much’ as FTSE 250 companies
In its annual report, Games Workshop stated that its current remuneration policy cannot fully address like-for-like total compensation for executive directors compared to the majority of FTSE 250 companies due to the absence of any LTIP or long term share award scheme.
It added: “As a group, in keeping with the culture and values of the company, the belief is that formulaic target incentive setting within LTIPs goes counter-culture to the forever, team effort and leadership that the company has thrived on to produce year on-year growth over time.
“Therefore, a performance share-based element common to large and medium sized companies has not been part of the accepted remuneration policy.
“The current policy does not allow for any alternative compensation mechanism.”
Record results for Warhammer maker
The AGM vote came after Games Workshop reported its best-ever set of full-year results as customers at the end of July continue to spend on the fantasy miniatures and related PC games.
The company’s reported revenue grew by 11.1 per cent to £494.7m for the 53 weeks ended 2 June, 2024.
On a constant currency basis, core sales were up by 13.9 per cent to £507.4m.
Its pre-tax profit also surged from £170.6m to £203m over the same 12 months.
In a statement issued to the London Stock Exchange, Games Workshop said: “The board notes that more than 20 per cent of the votes cast on resolutions 10 and 11 (the former of which is an advisory vote) were against those resolutions.
“It takes the outcome of shareholder votes very seriously and will engage with shareholders to understand their views.
“In accordance with the UK Corporate Governance Code, the company will publish the outcome of this engagement in the next six months.”