National Express, the bus and train group which failed to get its Greater Anglia rail franchise renewed last year, is to beef up the remuneration package of its Chief Executive, Dean Finch.
The company, whose shares are down 16% over the last year - the Travel & Leisure sector has risen 13.8% over the same period - said the changes to the package had been made in view of Finch's "significant contribution to the group's growth and development."
Finch is set to receive an additional performance share award of 261,407 shares in five years' time, subject to the delivery of earnings per share growth and a superior total shareholder return (price accumulation plus dividends) compared with a peer group of transport companies over the five year period. The award is subject to Finch still being with the company in five years' time.
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On top of that, the upper limit of Finch's annual bonus level has been increased from 125% of his salary - £550,000 last year - to 150%. Last year Finch received a bonus of £687,000, plus benefits to the value of £25,000 and benefits in lieu of pension of £192,000, to give a total package of £1.45m, up from a mere £1.36m the year before.
In case Finch blows all of his considerable salary before he retires, the company is boosting his pension arrangements as well. Finch, who became Chief Executive in 2010, is set set to see the improved pension arrangement accruing at 25% of basic salary plus a fixed 5% investment return kick in after 10 years of service.
Late last month the group revealed that revenue was down 17% year-on-year to £934.1m in the first half of the year, while reported profit before tax fell to £32.1m from £54.7m in the first half of 2011.
JH
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