Ballymore paid departing UK finance director David Pearson almost €3 million when he left the Irish builder's British business last year, new figures show.
Accounts for Ballymore Ltd and subsidiaries, responsible for part of the Irish group’s British operations, also show the company reviewed its buildings in light of changes to UK safety regulations prompted by the Grenfell disaster in 2017.
The figures, for the 12 months ended March 31st, 2021, show the company paid Mr Pearson £2.48 million (€2.9 million) last year, part of which was a termination payment he received on his resignation as a director in April.
Mr Pearson earned the extra cash over 10 years under a long-term bonus scheme designed to entice senior managers into staying with the company for a number of years.
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As a result, payments to Ballymore Ltd's three directors – founder and owner Sean Mulryan, his son John Mulryan, and Mr Pearson – rose to £2.8 million in the 12 months to March 31st, from €1.18 million the previous year. The company appointed Patrick Dalton as director on April 1st last year.
Ballymore Ltd’s accounts refer to UK housing minister Michael Gove’s call last month on developers in Britain to pay to tackle fire-safety problems in cladding, material used on the outside of buildings, including apartment blocks.
The directors’ report states that, on January 10th, the secretary of state announced the government’s “updated policy position and funding considerations required for remedial works” arising from the use of unsafe cladding and material in residential buildings.
Buildings review
Ballymore has committed cash and resources to carry out work on a number of its buildings, the report states.
The group carried out a detailed review of its buildings, spoke regularly to affected leaseholders and hired professional advisers to aid it in dealing with the the problem, according to the accounts.
Its directors noted that the group was working with stakeholders to ensure that, as far as possible, all its residential buildings were safe and did not contain dangerous construction materials.
“The group supports the actions of the government both to ensure buildings are safe for people to live in them and to implement the recommendations of the 2018 independent review of building regulations and the fire safety report,” they say.
The UK government commissioned the 2018 report following a fire in Grenfell Tower in London, which killed 72 people.
Changes in safety laws could leave builders in Britain with an estimated £4 billion bill for work on existing apartment blocks and other structures that do not meet the new standards.
Mr Gove’s call last month was the latest stage in a row between the government and builders over who should carry the cost of bringing buildings up to the new standards.
Falling revenues
Ballymore Ltd’s revenues fell to £41 million over the 12-month period from £111 million in the company’s previous financial year.
The company had sold property to another group business in the 12 months to March 31st, 2020, more than doubling its turnover as a result.
Pretax profits last year fell to £22.2 million from £99.8 million. The company did not pay a dividend. Shareholders received £15 million in the previous financial year.
Meanwhile, accounts for Ballymore Properties Ltd, another UK entity, recorded a loss of £56.2 million for the year to the end of March 2021. This was impacted by a £30 million provision for group and related-party receivables. Its turnover declined to £9.8 million from £16 million a year earlier.
And the company made a donation of £2.5 million to the English National Ballet School.
Ballymore Ltd’s subsidiaries employed 89 people, including the three directors, paying them £5.2 million in total.
The company's ultimate parent is Ballymore Properties Unlimited Company, the Irish-based group that Mr Mulryan controls.
