Shareholders reject £26m bonus for founder

Investors in the UK’s biggest sporting goods retailer rejected a proposal that could have netted Mr Ashley a one-off shares bonus worth around £26m based on the current share price.

The group had intended to ask investors at the AGM yesterday to back the grant of eight million shares to Mr Ashley, which would pay out in 2018 if certain performance criteria were met.

The level of proxy votes in favour of the special resolution did not reach the required 75 per cent and so the board decided to withdraw the resolution from the meeting.

Mr Ashley, who owns Premier League club Newcastle United, was not allowed to vote with his 71 per cent holding.

Dave Singleton, non-executive director and chairman of the remuneration committee, said: “As a board, we are very disappointed that this resolution was not passed. However, we respect shareholders’ views.”

He said a new scheme with further performance criteria would be proposed to shareholders at a future meeting.

Mr Ashley, the group’s executive deputy chairman, does not take a salary.

Earlier this year a “shareholder spring” prompted investors to vote against big pay rises at underperforming companies.

This led to the departures of Aviva boss Andrew Moss and Sly Bailey, head of newspaper group Trinity Mirror. Earlier yesterday Sports Direct reported a 25 per cent jump in first-quarter sales, helped by the popularity of the Olympics.

Sales for the 13 weeks to July 29 were £519m, up from £414.3m. This beat growth of 13 per cent in the 2011-12 year.

Gross profit increased 20.4 per cent to £211.1m.

Chief executive Dave Forsey said: “During this unprecedented sporting summer our retail performance continues to go from strength to strength.”