BY ALL accounts, the last 12 months in travel, aviation and tourism has been a wild ride. Given how busy everyone is at the moment the desperate travails of 2020, 2021 and the early part of 2022 are now fading into the background, notwithstanding the deep scars and disruption left behind by the COVID-19 pandemic. During those dark years it was not a lot of fun preparing our annual Million Dollar Club report, as the plummeting incomes of senior executives of our listed companies reflected the wider pain being felt by everyone.
This year, things are different. While much of the the industry continues to be in recovery mode, some sectors – particularly airlines – have managed to reap the benefits of huge demand with limited supply, and the stellar financial performance of these companies has been reflected in the pay packets of some of those at the top. And while opinions may differ, there’s no doubt that many of our leaders well deserve the opportunity to reap the rewards of guiding their businesses through the downturn.
Before we dive into the results for 2023, let’s just run through some basics on where these figures come from. Publicly listed companies – those whose shares are traded on the Australian Securities Exchange – must comply with a range of strict rules and timetables. For example, they have to continuously keep investors informed of any significant changes to their finances; they have to provide a formal report of their results at least every six months; and they have to produce an annual report which is presented to shareholders at a formal Annual General Meeting. Finances must be externally audited, and results must be reported within two months of the end of a company’s financial year, complemented usually a month or two later by the more comprehensive annual report.
Within that annual report each company’s activities for the year must be documented – and there’s also a compulsory section called a Remuneration Report which records the makeup of what Directors and designated Key Management Personnel were paid. Executive remuneration is generally comprised of multiple components: base salary, short-term performance-based incentives (usually paid as cash bonuses), and long-term incentives, which are most often share-based payments such as options to purchase shares, or actual fully paid shares in the company. Long term incentives often only become available to the recipients some years after they were awarded, as a means to encourage leaders to stay committed to the business, and also with the aim of aligning individual pays to overall shareholder outcomes – profits and dividends.
That means that most executives and directors have a stake in the businesses they are managing – which in turn means that when those businesses are sufficiently profitable to pay a dividend, the leaders of the companies also benefit. And while dividends have been non-existent during the pandemic years, industry recovery means that for some, their overall incomes have benefited as they take the payouts alongside the rest of the shareholders. As usual, we have added all of these components together from the remuneration reports as well as shareholdings and dividends to compile our annual Million Dollar Club listings.
Once again we have also broken out the figures into three separate tables for travel agencies, aviation and other tourism providers, as well as collating them into the overall top 15 Million Dollar Club members for 2023.
Travel agency top earners
The last few years have been pretty lean for Australia’s listed travel agencies, Flight Centre Travel Group, Helloworld Travel, Webjet and Corporate Travel Management. Perhaps underdoing not quite a near-death experience, drastic survival measures saw them undertake some pretty radical capital management initiatives, slash staff, sell assets and re-engineer their operations. Apart from Webjet, none of them paid a dividend last year, but in 2023 that changed and in turn saw changes in our top travel agency earners list.
Flight Centre CEO Graham Turner, who last year was in 17th position on the list (significantly behind several of his executive team) – and didn’t even make it into the overall Million Dollar Club of 15 top earners across travel, aviation and tourism – has shot to the top in 2023 thanks to an 18 cent per share dividend paid by the company. Turner continues to retain more than 16.5 million Flight Centre shares, and so that multiplied his $1 million pay package fourfold to almost $4 million.
Other Flight Centre staff in the 2023 travel agency top earners list included corporate chief Chris Galanty, who just cracked the $3 million total remuneration mark, while others further down in the rankings included CFO Adam Campbell whose package was worth just over $2 million, and Leisure CEO James Kavanagh, with payments worth $1.6 million which saw him just scrape into 15th spot in our overall Million Dollar Club for 2023. Further down the travel agency list were Charlene Leiss, FCTG MD for The Americas, and Steven Norris, FCTG MD for Europe, Middle East and Africa, each taking home just over $1.3 million.
There were no dividends this year for last year’s listed travel agency leader, Webjet CEO John Guscic, who slipped into second position behind Skroo Turner, albeit with a still extremely healthy $3.8 million package. Guscic received a base salary of $1.6 million, a short term incentive of $1.1 million and another $1.1 million in share-based payments, and is now sitting on 6.35 million Webjet shares which will keep him near the top of the list if the company decides to pay a dividend this year. Shelley Beasley, Webjet Global Chief Operating Officer, had a package worth just over $1.5 million, just ahead of workmate Tony Ristevski, Webjet CFO, on $1.43 million.
Helloworld CEO Andrew Burnes came in third position on our travel agency top earners list, with base pay of about $850,000 and a $600,000 short term incentive topped up with $1.65 million in dividends from the company, making a total remuneration package worth $3.09 million. That was fractionally ahead of Helloworld Executive Director Cinzia Burnes, who took home $3.04 million for the year. Andrew Burnes and Cinzia Burnes each have more than 20 million shares in Helloworld, which has paid 8 cents in dividends over the last 12 months, catapulting the pair close to the top of the rankings.
Two other Helloworld staffers also appear in our top 20 list of travel agency earners: CFO Michael Smith in 18th spot with payments worth $533,000, and former GM of Retail and Digital Transformation, Nic Cola, paid $366,000 prior to his unannounced departure from the company in March this year.
Corporate Travel Management didn’t pay a dividend last year, and that saw its executives a little further down the ranks, most particularly CEO Jamie Pherous who normally receives a significant part of his income from the company’s share-based payouts. In fact Laura Ruffles, Global Chief Operating Officer, was the top CTM earner on our list this year, in seventh position with a total package worth just over $1.85 million. That was just ahead of the company’s CEO North America, Kevin O’Malley on $1.7 million, while Pherous himself took home just over $1 million, comprising his $595,000 base salary and a $421,000 short-term incentive payment.
Airline top earners for 2023
The big news in airline remuneration this year was of course the controversy around Qantas CEO Alan Joyce, who after presiding over a record profit ended up resigning earlier than planned amid soaring customer complaints, ACCC allegations the airline sold tickets for already cancelled flights and the $17 million sale of much of his personal stake in the carrier while he was still in the top job.
While Joyce is likely to be licking his wounds for a long time, perhaps the pain will be slightly eased by his sky-high remuneration which crystallised various long-term share-based incentives to see him earn a reported $21 million-plus package. The Qantas Board has made pains to point out that some of this is subject to “malus and clawback” depending on the outcome of the Australian Competition and Consumer Commission’s case, but on the other hand it’s hard to deny that Joyce led the carrier successfully through its most difficult period ever and brought QF out the other side with a stellar profit result. His job, after all, is to build value for shareholders and financially that’s been an undoubted success.
Other Qantas executives also reaped the benefits of the long term incentive programs instituted through the pandemic as a retention initiative, and although they’re not at the stratospheric heights achieved by their boss, other top airline earners at QF include Vanessa Hudson, formerly CFO and now Joyce’s successor, whose total package was worth more than $5.1 million for the year. Now departed CEO of QF Domestic and International, Andrew David, earnt $4.9 million, while Olivia Wirth, also now no longer with the carrier, had remuneration worth $4.2 million in her final full year as CEO of Qantas Loyalty. Finally Jetstar CEO Stephanie Tully came in sixth spot on our airline top earners list with a remueration package of just over $3.2 million.
Across the Tasman things are a little more opaque, because the rules around remuneration reporting in New Zealand don’t currently require a breakdown of the remuneration for anyone except the CEO of a listed company. Accordingly, we know that Air NZ chief Greg Foran took home $3.96 million, including a base salary of $1.8 million, plus $1.9 million in short-term and long-term incentive payments. However when it comes to his executive team we can only glean that various senior executives at the Kiwi flag carrier were paid amounts ranging from $1.36 million down to $1.02 million. Accordingly they appear in our list of top earners but aren’t named; however they would likely include Chief Financial Officer, Richard Thomson; Chief Customer & Sales Officer, Leanne Geraghty; Chief Operating Officer Alex Marren; and Nikhil Ravishankar, Chief Digital Officer.
By comparison to Qantas and Air New Zealand, remuneration at our other two publicly listed aviation companies looks very very different. In fact Rex Airlines Executive Director, Lim Kim Hai, takes no salary at all from the carrier meaning that in a year like 2022/23, when no dividends were paid, he earnt nothing from Rex. The top-paid Rex leader was Group Flight Operations Advisor and Executive Director, Chris Hine, whose package was worth $320,000. Rex Chief Operating Officer Neville Howell also took home $320,000, just ahead of GM Flight Operations, Paul Fisher on $311,000 and GM Corporate Services, Irwin Tan on $271,000.
At Alliance Airlines the execs fared slightly better, with Managing Director Scott McMillan’s package worth $649,000, while Chief Financial Officer Marc Devine was paid $393,000. The Alliance Airlines remuneration table is somewhat tricky this year with the departure of former CEO Leo Schofield in July last year including a significant payout for accrued leave and benefits, seeing him take home a total of $467,000 albeit on a base salary of just $32,000.
And what about tourism and hospitality?
With a range of other public companies also operating in the tourism space, we’ve collated their top earners in our third table – covering sectors as diverse as hotels, ski resorts, airport transfers, theme parks, skydiving, public transport, technology and more. Some of these businesses are very diverse within themselves, also earning revenue from other areas like gaming, movies and bowling, making direct comparisons a little tricky. But nevertheless it’s instructive to see what those at the top are taking home, with Jane Hastings, CEO of EVT Limited the leader this year with a total remuneration package worth a healthy $5.1 million. Interestingly that only included a small contribution from her shareholding in the company, with the overall payments including a $1.7 million base salary, topped up with another $1.7 million short term incentive and $1.3 million in share-based payments. The EVT portfolio includes Event Cinemas, Thredbo Alpine Resort, hotel brands including QT, Rydges, Atura and Lylo plus a host of other property development ventures.
Clint Feuerherdt, the CEO of Kelsian Limited, similarly presides over a diverse portfolio which comprises the SeaLink Tourism ventures such as Kingfisher Bay Resort, Captain Cook Cruises and more alongside a host of public transport operations in Australia, the USA and other parts of the globe. He ended up in second spot on our list this year with a total package worth just over $3 million, including $1 million in dividends from the company in which he holds almost six million shares.
Across the ditch, Grant Howard who is CEO of New Zealand-based motorhome giant THL Limited was in third position, bolstered by the company’s merger with Apollo Tourism and Leisure. Howard’s $2.1 million overall package included a $901,000 base salary along with a $242,000 bonus and $366,000 in dividends.
Other noteworthy inclusions in the list include Experience Co CEO John O’Sullivan. The former Tourism Australia MD took home $1.2 million, including a $429,000 base pay with a $123,000 bonus and share incentives worth $465,000. This year’s list is also significantly different to that in 2022 after the ructions that have rocked the gaming industry over the last 12 months. These saw significant executive changes at Star Entertainment Group, where CEO Robbie Cooke took home $1.3 million. And unfortunately for us industry voyeurs, casino and hospitality behemoth Crown is now privately owned so its accounts are no longer subject to the disclosure requirements that enable us to include its executives in our report.
This year’s list does, however, include several travel technology companies including Siteminder Limited where CEO Sankar Narayan took home $1.17 million, as well as Serko Limited whose CEO Darrin Grafton’s package was worth $972,000, just outside that magical million dollar mark. Finally global transfers marketplace Jayride Limited is also in the list, with CEO Rod Bishop’s package worth $345,000 for the year.
So who’s in the 2023 Million Dollar Club?
This year we’ve collated all of the top earners across Travel Agencies, Airlines and Tourism & Hospitality into a top 15 list, where the packages range from $21 million at the top (for Qantas CEO Alan Joyce) through to Flight Centre’s Leisure CEO, James Kavanagh, who squeaked into 15th spot with $1.6 million in total remuneration. Airlines once again dominate the top end, even disregarding Joyce’s big retirement payout, with his successor Vanessa Hudson in second spot even before she took over as Qantas CEO.
The top travel agency earner was Graham Turner in seventh position on the list with $3.9 million in total remuneration, helped along by that aforementioned dividend payout, putting him just ahead of Webjet’s John Guscic in eighth spot with $3.8 million. Helloworld Travel Limited’s Andrew and Cinzia Burnes are a few spots lower in the order for 2023, appearing in positions 10 and 12 with $3.09 million and $3.04 million in remuneration respectively.
What does the next 12 months hold? The 2024 Million Dollar Club is unlikely to include such a huge outlier as Joyce’s $21 million, and I predict that dividends will play an increasingly key role in determining the order next year. With Flight Centre, Helloworld, Webjet and Corporate Travel Management all reporting strong figures already for the current year, it’s likely that any senior executive who is also a major shareholder will benefit – while by contrast the unrest at Qantas as well as global disruptions, high fuel prices and the complexities of running a carrier may see the relative remuneration of airline top executives decline against their other industry peers. But in the end, the proof will be in the pudding, and we look forward to once again bringing you the Million Dollar Club in 12 month’s time.
