Top executives at housebuilder Glenveagh get bumper pay rise

Stephen Garvey was paid just over €1.6m in salary, benefits and bonus, while Michael Rice took home more than €1.5m

Stephen Garvey, CEO of Glenveagh

Jon Ihle

Pay for the top executives at one of Ireland’s biggest housebuilders nearly doubled last year as the board decided to pay the maximum bonuses.

Glenveagh chief executive Stephen Garvey and chief financial officer Michael Rice received more than €3.1m in total compensation in 2022 as the company hit profit targets for the year, according to its annual report.

Mr Garvey, who is one of Ireland’s youngest CEOs at age 43, was paid just over €1.6m in salary, benefits and bonus, while his number two, Michael Rice (age 40), took home more than €1.5m, which also included a share grant of nearly €546,000.

Mr Garvey’s base salary of €600,000 was supplemented by a €900,000 bonus award, alongside €90,000 in pension payments and €24,000 in other benefits.

Mr Rice got €400,000 in regular salary plus a €500,000 bonus in addition to his share award and other benefits.

The mulitimillion euro compensation represents a major increase from the previous year, when the two made less than €1.7m in total compensation.

Chair John Mulcahy, who himself was paid €200,000 to run the Glenveagh board last year, said the remuneration was “wholly appropriate” based on the performance of the company, which completed more than 1,300 homes in 2022.

Pretax profits at Glenveagh were up 38pc last year as the company increased its output amidst a major shortage in the supply of housing. Margins fell slightly, but still came in at a robust 16.8pc.

The performance was good enough to meet the criteria for a maximum bonus payout for Mr Garvey and Mr Rice, who were due additional payments of 150pc and 125pc of their salaries, respectively.

According to the annual report, the bonus is awarded based on a weighted formula for performance in four different areas. Profits count for 50pc, followed by margins at 20pc. Customer satisfaction and health and safety count for 15pc each.

Two-thirds of the bonus is paid directly in cash while one-third is awarded in shares, which are then subject to a clawback mechanism.

Glenveagh shares are up 18pc so far in 2023, but struggled last year in volatile markets and have fallen just over 16pc in the last 52 weeks. Shareholders however have been getting cash returns in the form of an ongoing buyback programme.

Although Glenveagh had a strong performance last year, the company warned shareholders in January that it wouldn’t hit delivery targets in 2023, blaming planning regulations for a sluggish pipeline.

“We are ready to play a leading role in delivering more supply,” Mr Garvey said at the company’s annual results earlier this month. “But the industry needs correct policy decisions and a planning framework that is designed for the types of homes that people want - and one which does not undermine the commercial viability of delivering more of these types of homes.”

Glenveagh favours building more suburban own-door homes, which bring higher profit margins for the company, over apartment buildings, which Mr Garvey said are currently favoured by planning rules.