CRH chief executive Albert Manifold's pay package hit €10 million last year, setting a new record for the boss of an Iseq company, driven by a share bonus payment tied to awards made three years ago.
The 54-year-old head of Ireland’s largest publicly-quoted company saw his €1.4 million basic salary, €696,000 pension and other benefits and €3.1 million annual bonus capped off by a €4.8 million award under a long-term incentive plan, where performance targets were met in full. The figures were contained in the group’s annual report, published on Friday.
Shareholder returns
The long-term incentives were mainly based on shareholder returns during the period, as the share price jumped 80 per cent to end 2016 at €32.95, giving the group a market value of €27.4 billion. The stock surged by 13 per cent in the last seven weeks of 2016 alone, on hopes that its US unit will be one of the main beneficiaries of US president Donald Trump’s plan to spend $1 trillion on infrastructure.
Mr Manifold’s total remuneration last year jumped from €5.4 million for 2015. He is set to receive an even higher compensation package in future after CRH moved last year to raise his maximum stock and cash bonus to 590 per cent of his annual salary, up from 400 per cent, previously. About 40 per cent of shareholders who voted on the new plan at the group’s annual general meeting last year rejected the move.
“CRH has transformed over recent years, increasing in complexity and scale and is now positioned at 24 in the FTSE 100 index, some 18 places higher than when CRH joined the index in December 2011,” said Donald McGovern, chairman of the group’s remuneration committee in the annual report.
“During that time, the group’s market capitalisation has grown from €10 billion to €27.4 billion.”
Transformational year
CRH went through a transformational year in 2015 as it spent €8 billion on acquisitions, including the €6.5 billion purchase of assets hived off by European cement giants Lafarge and Holcim to appease competition authorities under their own merger. Earnings before interest, tax, depreciation and amortisation at CRH jumped 41 per cent to a record €3.13 billion last year, while the group slashed its net debt by €13 billion to €5.3 billion.
Mr Manifold said last week the group could spend as much as €3 billion on deals over the next 18 months, having committed €500 million on purchases in the first two months of 2017 alone.
The CRH chief executive sought to downplay the impact of Mr Trump’s infrastructure proposals, focusing instead on US spending plans that have already been approved. These include the existing $300 billion-plus FAST Act highway spending programme, voted through in late 2015, and various additional infrastructure spending measures backed by voters in a number of US states last November.
Top package
While Mr Manifold’s remuneration last year is a record for an Iseq chief executive, it is not the highest for the head of an Irish-based publicly-quoted company.
Icon, the Nasdaq-listed pharmaceutical clinical trials firm, has consistently awarded its chief executive Ciaran Murray the top pay package in Dublin in recent years. Mr Murray, who stepped down as Icon chief executive last week to become company chairman, received a $10.7 million (€10.1 million) remuneration package last year, down from $14.2 million in 2014.
Meanwhile, advertising giant WPP’s chief executive, Martin Sorrell, received a £17.6 million (€20.2 million) package in 2012, the last year of a four-year stint where the UK-run company’s corporate headquarters was based in Ireland.
