X5 plunges as profit misses estimates on executive bonus payouts
MOSCOW: X5 Retail Group NV, Russia's second-largest retailer, fell the most in six weeks after quarterly profit missed analysts' estimates because of management bonus payouts. The company's global depositary receipts fell as much as 6.8 percent in London trading Monday. Fourth-quarter earnings before interest, taxes, depreciation and amortization slid to 13.5 billion rubles ($196 million), or 5.8 percent of sales, the retailer said in a statement. That missed Interfax estimates for a 7.3 percent margin.
"X5 agreed to pay about 4 billion rubles to reward and retain managers that helped to achieve a turnaround in business and accelerate growth last year," said Natalya Kolupaeva, analyst at ZAO Raiffeisenbank in Moscow. "This is being negatively perceived by the market." Former Chief Executive Officer Stephan DuCharme -- who resigned in September -- received 916 million rubles in compensation last year, almost a six-fold boost from his 2014 pay, thanks largely to a 440 million ruble exit payment and a long-term bonus of 399 million rubles. New CEO Igor Shekhterman earned 172 million rubles last year, mostly from incentives.