The recent corporate reporting season for publicly listed companies has seen some record results, with many businesses in the travel and tourism sector rewarding shareholders with strong performances, dividends and share price increases. But how have the leaders of these organisations fared this year when it comes to their own personal remuneration? Bruce Piper delved into the data to work out who the travel and tourism industry’s top earners were in 2017/18.

Fancy a new Lamborghini, Tesla or even a Bugatti supercar? How about a private jet? Such aspirations are beyond the wildest dreams of many of us, but for the top earners in the Australian travel and aviation sector they are easily achievable realities. Based on the now publicly released remuneration reports which every public company must include in its reporting, it has been a pretty good year all round, and senior executives have reaped the benefits both in terms of their base salaries and bonuses, not to mention those all-important dividends.

Every company on the Australian Stock Exchange must include a formal Remuneration Report in its annual report to shareholders. The document is required to detail payments to the company’s directors as well as to designated “key management personnel” and include everything from base salary to bonuses, to share based incentives and even superannuation and travel fringe benefits. Some fairly strong glasses are required to comb through the fine print, but the effort is worth it, with the reports making for fascinating reading. The information generally details how salary packages are calculated, and gives an insight into how the chiefs are incentivised to perform. There are a few juicy nuggets in some cases too, such as details of sign-on bonuses, redundancy payouts and extra payments for relocation.

Most of the designated “key management personnel” in Australia’s listed travel and tourism companies have their packages weighted towards driving performance in terms of improving shareholder returns, and so it’s only right that if they achieve or exceed targets they are rewarded for doing so. 2017/18 produced some bumper outcomes which were reflected in short and long-term incentive payouts — but as in previous years, the executives who also happen to be major shareholders are the ones who are most likely to be out shopping for a new Gulfstream.

Travel agent top earners

Flight Centre has had a cracker of a year. Although the company’s share price has recently dipped from record levels, the powerhouse surpassed just about every target in 2017/18, achieving profitability in all regions, an 8.5% increase in Total Transaction Value to almost $22 billion and a 14.5% increase in net profit after tax to $264 million. With results like that it’s no wonder that cEo Graham Turner once again came in at the top of this year’s travelBulletin Million Dollar Club. Including bonuses his salary package was a somewhat modest (if you can call it that) $1.43 million — but the hefty $1.54 per share dividend payout saw his total income soar to almost $25 million, an increase of about 15% on the prior year.

Other Flight Centre executives did well too. Chief operating officer Melanie Waters-Ryan came in 13th on the Million Dollar Club list with a total package of just over $3 million — just ahead of FCTG executive gm Europe Chris Galanty and Dean Smith, who heads up the Americas for Flight Centre, who earnt $2.6 million. As well as good base salaries and bonuses, most of the Flight Centre top earners also reap rewards from the company’s Business Ownership Scheme (BOS) where they hold convertible notes reflecting the performance of particular business units. There’s also a further bonus scheme to incentivise them to stick around, with extra BOS payments based on their length of service.

At Helloworld Travel it’s a similar story, although not quite on the same scale. The top earners are ceo Andrew Burnes and executive director Cinzia Burnes, who are also the company’s largest shareholders. The pair each drew a salary package of just over $500,000 — much lower than the heady days under previous administrations where some senior executives were paid in the millions. But when the 18c per share dividend payout is taken into account that overall figure increased to a total of just under $9 million combined. They were the only Helloworld executives to reach the Million Dollar Club this year, with chief financial officer Michael Burnett next in line, taking home a total of $689,000.

Things may change next year, however, with because the 2017/18 figures don’t reflect a full year with Helloworld for John Constable, appointed as Group General Manager Retail and Commercial in February this year. Constable’s package for the five months to June was worth just under $600,000 — including about $200,000 for relocation and dividends on 500,000 shares.

The team at Corporate Travel Management also reaped the benefit of a soaring share price — most notably ceo and founder Jamie Pherous, who came in third on the Million Dollar Club list with just over $8 million in total income. Other travel agency ceos in the club included Webjet chief John Guscic, who nudged $3 million this year including a handy $770,000 in dividends.

Airline chiefs fly high

Once again this year’s Million Dollar Club was populated by senior airline executives, with Qantas, Virgin Australia and Air New Zealand all featuring. Qantas CEO Alan Joyce, who last year earned a record $24 million due to a huge increase in the QF share price, this year saw his total package plummet to about $11.5 million — keeping him in second spot on the list and still taking home more than twice as much as his nearest airline equivalent, Air New Zealand CEO Christopher Luxon whose total package amounted to just under NZ$5 million. Meanwhile outoing Virgin Australia ceo John Borghetti, who has flagged his intention to depart by the end of 2019, cracked the $4 million mark this year, placing him just behind Jetstar ceo Gareth Evans whose package was worth $4.07 million.

Qantas chief financial officer Tino La Spina and domestic ceo Andrew David came in at 9th and 10th on the list — just ahead of Regional Express executive director Lim Kim Hai, who again in 2017/18 received no salary or bonus, but took his remuneration in the form of dividends on his significant shareholding in the carrier. Other Qantas executives in the club this year included Qantas Loyalty ceo Olivia Wirth whose package was worth just over $2.5 million, and head of Qantas International, Alison Webster, who took home $1.55 million. Other notable mentions should go to the various unnamed Air New Zealand senior executives, who have thus far managed to evade deep scrutiny because different rules on the NZ stock exchange don’t require their specific incomes to be individually identified in the report. However an educated guess would put Air New Zealand chief commercial officer Cam Wallace, chief people officer Jodie King, chief operations officer Bruce Parton and chief flight operations officer David Morgan firmly in the Million Dollar Club.

Other industry winners

New companies entering the fray this year have included travel technology firm Serko Limited and campervan rental specialist Apollo Motorhomes, both of which were added to the Australian Stock Exchange in the last 12 months enabling scrutiny of their executive pay packets. Apollo chiefs Luke and Karl Trouchet came in at 16th and 17th on the list this year, each earning close to $3 million. By contrast Serko ceo Darrin Grafton and chief strategy officer Bob Shaw were well out of the Million Dollar Club this year, with packages worth NZ$439,000 and NZ$357,000 respectively. If Serko is able to pay dividends in future years that is likely to change, however, with the pair both holding large stakes in the company.


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