Europe's largest retail store operator Carrefour is cutting its 2019 dividend by half to around 0.23 euros per share. Along with the dividend cut, the company announced on Monday that its chief executive officer, Alexandre Bompard, will be cutting 25 percent off his fixed salary for the next two months in order to save on costs amid the ongoing coronavirus pandemic.
Apart from Bompard, the company is also proposing to freeze all fixed salaries for top executives for the entire year. Bompard reportedly also requested that executives shave off 10 percent from their pay for the next two months to make sure that the company will have enough finances to weather the peak of the outbreak.
Other cost-saving measures imposed by the company include the reduction of director's fees by 25 percent for the entire year. Carrefour's board of directors has reportedly already approved the measure. All of the money saved up from the pay cuts will reportedly be going towards supporting various employee programs for workers in heavy hit areas in Europe and abroad.
The company currently has more than 12,000 stores in over 30 countries in Europe and overseas. The food retailer employs more than 320,000 workers, most of which are considered essential personnel, particularly those working in its supermarkets and grocery stores.
Carrefour initially announced in February that it planned to give out dividends of around 0.46 euros per share for 2019. On top of the 50 percent dividend reduction, Carrefour is offering shareholders the option of getting their dividends either through cash or in new shares. However, substantial cash out or share requests will still need to be approved during the company's upcoming annual shareholders meeting on May 29.
The meeting itself will be held behind closed doors but will be broadcasted on the company's website. In line with the current social distancing measures and to mitigate the further spread of the virus, Carrefour is discouraging the attendance of shareholders during the event. The company has set up an online system for shareholders to cast their votes remotely.
Shareholders who will opt to get their dividends in new shares will be given a much better deal. The new shares will be issued at a price equivalent to 95 percent of the average of Carrefour's closing price indicated on the Euronext 20 days prior to the annual shareholder's meeting.
Carrefour stated that all shareholders must submit their requests for either a cash or share payout between June 10 and June 23. Requests must be submitted to authorized financial intermediaries or other authorized agents.
