Saturday 16 December 2017

Killian may bag €10.2m wage deal at Aryzta

Boss's package is 324 times pay of average staff

Nick Webb

Nick Webb

Croissant baker Aryzta -- formerly IAWS -- handed its boss Owen Killian a pay deal worth up to €10.2m last year, making him the highest paid executive in any Irish-listed company, according to the latest figures.

Killian's €10.2m package is a staggering 324 times the average pay of staff at Aryzta. However, it is a far smaller package than the previous year's top-paid executive received, when Tullow Oil's Aidan Heavey earned €34m -- largely through share options dealing -- while Mr Heavey's right-hand man Graham Martin picked up €12.5m.

The top 10 highest paid executives of Irish-listed companies earned up to €46m last year, according to annual reports published over the past fortnight.

This is less than half the amount that the top 10 took home the previous year, according to the Sunday Independent CEO pay survey. The executives shared a €93m bonanza a year earlier -- however, this figure was hugely skewed by a near €48m paid out to Mr Heavey and the other Tullow executives.

Executives get paid far more than just salaries and bonuses. The real money is in share awards or various stock options schemes. These may pay out if the company grows profits over the term of various incentive plans.

Our calculations of total remuneration packages follow those used by business magazines Forbes and Businessweek plus news service PA. Salary, benefits, bonuses and pension payments are included, as are conditional stock awards and grants. Gains on option grants and trading are included. However, increases in the value of shares held or dividend payments are not included.

The bulk of Mr Killian's pay package was made up with the conditional "matching" award of 300,000 shares, worth about €7.32m in July 2009. Those shares are now worth nearly €9.3m. However, Mr Killian and his team must match ambitious profit growth targets before these shares will vest and trading conditions make those targets look even more tricky.

Mr Killian also trousered €2.88m in salary, bonus, pension and benefits in kind. Aryzta is headquartered in Switzerland, which has much less stringent rules of disclosing directors' pay. Just Mr Killian's wage is revealed in the annual report.

Mr Killian's key lieutenants Hugo Kane and Patrick McEniff both received conditional awards under this scheme worth €4.39m. However, their total pay is not disclosed, although average executive remuneration was about €1.38m each. That would give the two executives packages of up to €5.77m subject to the bonus scheme kicking in.

Although he runs Ireland's biggest listed company, CRH boss Myles Lee was only the fifth best paid chief executive, bagging a €4.08m deal. He also received about €1.54m worth of options as part of his deal. However, the CRH share price is trading below the exercise price of these options.

C&C boss John Dunsmore and his executive team may see their remuneration at the cider company obliterate many of their rivals. When replacing the hapless Maurice Pratt in 2008, Mr Dunsmore and his team were incentivised to the tune of 16 million shares, which they are allowed cash in if the share price passes €2.50. They invested about €1.5m as part of the deal.

With C&C shares trading at about €3.30, after a series a major acquisitions and a cost cutting programme, Mr Dunsmore and his team are sitting on a bonus pot of more than €54m after just 18 months in the job. The gains have come after the year end, excluding it from our top 10.

Sunday Independent

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