RadioShack Corp. (RSH) investors rejected the company’s executive compensation for the second year in a row, signaling that shareholders are increasingly frustrated with pay levels at the struggling retail chain.
About 55 percent of votes were cast against the compensation plan in a nonbinding referendum at last week’s shareholder meeting, not counting abstaining investors, the Fort Worth, Texas-based company said yesterday in a filing. That was up from 53 percent last year.
RadioShack, which reports first-quarter results today, has posted eight quarters of losses because of waning product demand and competition from Amazon.com Inc. and Wal-Mart Stores Inc. Chief Executive Officer Joe Magnacca has updated stores and brought in new leaders while seeking to close 1,100 locations to stem declines. Magnacca, who became CEO in February 2013, was paid $8.84 million last year, according to regulatory filings.
“There’s nothing that he has done that leads anybody to believe that he’s the right guy to turn this business around,” Anthony Chukumba, a New York-based analyst at BB&T Corp., said in an interview last week.
RadioShack investors are not the only ones wary of company compensation plans. Shareholders at Staples Inc. and Chipotle Mexican Grill Inc. have rejected proposals this year, while Abercrombie & Fitch Co. announced in May that it had lowered its CEO’s 2013 payments by 72 percent after sales and profit fell.
RadioShack rose 4.8 percent to $1.54 at the close in New York yesterday. The shares have dropped 41 percent this year.
To contact the reporter on this story: Lauren Coleman-Lochner in New York at firstname.lastname@example.org
To contact the editors responsible for this story: Nick Turner at email@example.com James Callan, Ben Livesey