(Sharecast News) - Dunelm's bosses will have to increase earnings by 23% a year to receive a full share payout under their long-term incentive plan (LTIP), the company said.
The FTSE 250 group said in its 2020 annual report that it would struggle to set meaningful, stretching three year targets for the LTIP because of Covid-19 uncertainty.
After reviewing the company's business plan, the outlook and analysts' forecasts the homewares retailer has set targets for Chief Executive Nick Wilkinson and Chief Financial Officer Laura Carr for the year to June 2023.
If earnings are less than 60p the executives will get nothing under the LTIP. Payouts then rise in stages to 100% for earnings of 80% or more, amounting to a compound annual growth rate of at least 23%.
Dunelm said: "The proposed performance targets represent significant growth in total profitability compared to the pre-Covid-19 FY19 financial performance. The remuneration committee reserves the right to adjust the targets in the event of unexpected changes in tax rates.
"The remuneration committee can apply malus or clawback to the award, and has discretion to vary formulaic out-turns where this does not reflect underlying performance or is inappropriate in the context of unexpected or unforeseen circumstances."
Dunelm shares fell 0.3% to £14.71 at 09:45 BST.
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