Profitable, So Deducted Staff Pay Given Back

This article was published in The Business Times on 25 May 2009:

Profitable, so deducted staff pay given back

LIKE many other companies, Knight Frank has cut staff pay as one way of riding out the downturn. But unlike most, it's ready to pay back the amount taken away - when it does well.

Staff whose pay was cut by 10-20 per cent for the months of February to April have been paid back the deducted amount.

Knight Frank chairman Tan Tiong Cheng told BT that this was done after the company managed to 'scrape through' and make a profit for the year ended April 30, 2009.

And while the pay cut remains for the current financial year, Knight Frank will return the deducted amount again should it do well.

The group has a total headcount of about 560 people in Singapore. That's excluding its network of about 700 associates or agents who don't earn a salary but are paid commissions on sales instead.

Executive directors and directors took the biggest pay cut of 20 per cent from Feb 1, with other staff seeing their salaries trimmed between 10 and 15 per cent, again with more senior staff members taking the bigger hit. Those earning less than $2,000 a month were spared.

Mr Tan declined to say just how much profit the company made for the financial year just ended. However, he disclosed that turnover fell 25-30 per cent - investment sales and residential agency businesses were hit by the property slump, but valuation did 'extremely well' and retail agency also chalked up good numbers.

On a group basis, including the results of subsidiaries such as Knight Frank Shopping Centre Management, Knight Frank Estate Management (which does property and facilities management) and Knight Frank Property Network (the associates arm), revenue took a small dent.

Accounting and Corporate Regulatory Authority records show that the company made an after-tax profit of $5.4 million and had revenue of $37.2 million for the year ended April 30, 2007. Figures for the year ended April 30, 2008 were not listed.