Discount shares for new Finsbury Food boss

published 22 October 2009

Cakes and speciality breads maker Finsbury Food's new chief executive has been issued 1.04m shares at 19.25p a share as part of his remuneration package. He received a further 201,000 shares for nothing, taking his total stake to 1.25m shares. At the current share price of 28.5p, Duffy's additional shares are worth £353,000, against their total cost of £200,000.

John Duffy was appointed chief executive at the end of September 2009. He had been chief operating officer for more than one year. Duffy previously worked for Golden Wonder and Mars.

The cake and speciality breads business has been finding trading tough with weak demand and higher costs.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free

https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Finsbury Food's revenues increased 8% to £179m in the year to June 2009. Revenues no longer include customer rebates and promotional discounts. Like-for-like sales rose by 2%. Reported profits slumped from £5.07m to £1.78m. Underlying profits still declined from £7.73m to £5.05m. Gross margins improved from 26.8% to 27.2%.

The dividend was passed because Finsbury needs to cut its borrowings. Net debt was £41m at the end of June 2009 - £1.9m lower than six months before. Finsbury paid an initial £500,000 for bread maker Goswell Enterprises during June 2009 - £1.7m more is payable over four years. There is £3.3m of deferred consideration payable over the next 13 months according to Charles Pick of FinnCap.

Top Director Buys

Value: £200,000

Value: £31,500

Top Director Sells

Value: £844,531

Value: £352,268

Value: $299,960

Value: £57,717