By Jessica Hodgson
LONDON--U.K. newspaper publisher Trinity Mirror PLC (TNI.LN)
said Friday that its Chief Executive Sly Bailey will step down
almost six months earlier than planned following her her
resignation last month amid a row with investors over her pay.
In a statement Trinity Mirror, which publishes the tabloid Daily
Mirror and People newspapers along with around 130 regional titles,
said Bailey would step down with immediate effect instead of at the
end of the year as previously envisaged, ending a 10-year tenure at
the helm of the company.
A company spokesman declined to elaborate on why Bailey had
resigned earlier than planned.
Bailey will be replaced on an interim basis by Vijay Vaghela,
currently group finance director, while Trinity Mirror searches for
a more permanent replacement.
Bailey was awarded a salary for 2011 of GBP1.7 million, despite
having presided over a dramatic decline in the value of the U.K.
newspaper publisher's stock amid steep falls in newspaper
circulations and advertising revenue. Shareholder anger over the
pay policies prompted Bailey and the company's then chairman, Ian
Gibson, to resign.
The row is one of a string of high profile spats between U.K.
companies and their shareholders who are becoming increasingly
muscular in demanding that management reduce what has been seen as
excessive pay. The chief executive of U.K. insurer Aviva PLC,
(AV.LN) Andrew Moss, also resigned under similar circumstances.
More recently investors voted down the pay report of advertising
giant WPP PLC (WPP.LN) in anger over the size of Chief Executive
Martin Sorrell's pay, although they stopped short of calling for
Sorrell's resignation.
Trinity Mirror's share price roughly halved during 2011, and
during her time as CEO has fallen from around 460 pence to 26 pence
today.
In the year ended Jan. 1, pretax profit fell to GBP74.4 million
from GBP123.7 million the previous year, on revenue that was down
to GBP746.6 million from GBP761.5 million, mainly due to a 7% fall
in advertising sales.
More broadly, however, Bailey succeeded in protecting
profitability during her time at the head of the company, despite
falling revenues and has won some credit for this, but she faced
criticism from analysts for failing to address the strategic
challenges addressing newspaper companies, as they lose both
readers and advertising to Google Inc. (GOOG) and other Internet
services, as well as free newspapers.
In contrast with some newspaper groups which have made big bets
in digital, Bailey's tenure has been characterized by a relentless
focus on cost-cutting and has seen the closure of many newspapers
and redundancies.
Shares in Trinity Mirror were trading down 1.9% at just under 26
pence by 11.30 GMT in London.
-Write to Jessica Hodgson at jessica.hodgson@dowjones.com
(Rory Gallivan in London contributed to this article.)