Food company Aryzta, whose shares slumped 36 per cent over two days after a profit warning this week, has awarded its chief executive, Owen Killian, more than €28 million in remuneration since he became chief executive almost a decade and a half ago.
Mr Killian’s compensation includes salary, pension contributions, share and cash bonuses, according to annual reports for the company and its predecessor, IAWS Group.
The chief executive’s stake peaked in value at €56 million in June 2014, based on the exchange rate between the Swiss Franc and euro and his holding of 823,731 shares at the time. That month, and six weeks before Ayrzta’s stock reached an all-time high, he raised €17.4 million by selling about 256,000 shares.
Collateral
Mr Killian was forced to sell a further €16.8 million of shares, or two-thirds of his remaining stake, last March as the value of the stock, held as collateral against his personal borrowing, plummeted.
Following the group’s profit warning on Tuesday, the latest in a series of disappointing earnings reports and alerts over the past two weeks, the share price has slumped by more than a third. This has left his remaining 216,530 shares worth about €5.9 million.
The chief executive has a further 750,000 of fully vested stock options, according to the group’s most recent annual report, for the year to the end of last July. However, the price that Mr Killian is entitled to buy the underlying stock is above the current share price, leaving the under water.
Intense pressure
Mr Killian is under intense pressure to effect a turnaround in the company’s fortunes amid questions over the health of its US arm and its decision to buy a 49 per cent stake in French frozen food firm Picard for €446 million.
New chairman Gary McGann is understood to be meeting shareholders as part of a strategic review of the company.
The review will ultimately decide whether Aryzta should offload the Picard investment or not.
Higher wage costs were also said to weighing on the company’s operating margin, which will be about 9 per cent to 10 per cent this year. Hourly pay rates of low-wage workers are rising more than 10 per cent in the US, the company said earlier this week.
After a torrid few days, Aryzta’s shares traded up 2.3 per cent at €27.30 yesterday.
