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Diageo CEO receives £6.3m bonus after strong FY results
Ivan Menezes has been paid a £6.3m bonus on top of his £1.6m salary, as the company toasted strong results despite reduced consumer spending power.
Diageo, which has a portfolio including Guinness, Smirnoff and Johnnie Walker, is one of the most valuable public drinks companies in the world with a market cap of US$116.05 billion.
2022’s preliminary results, for the year ended 30 June, showed a 21.4% increase in Diageo’s organic net sales, reaching a level of £15.5 billion. Organic profits grew by 26.3%, with price increases and supply productivity savings offsetting the absolute impact of cost inflation.
Menezes noted that the company had benefitted from the on-trade recovery and singled out Johnnie Walker, which: “delivered double-digit growth across all regions to surpass 21 million cases globally.”
Menezes did express caution about the year to come, due to: “ongoing volatility related to Covid-19, significant cost inflation, a potential weakening of consumer spending power and global geopolitical and macroeconomic uncertainty.” Despite these challenges, he stated his “confidence in the resilience” of the business.
This is Money reports that Menezes has accumulated approximately £55.7m since he was appointed CEO in 2013. In addition to his salary and bonus, he also has a ‘product allowance’ as part of his supposed £133,000 benefits package.
The Chartered Institute of Personnel and Development (CIPD) found that Menezes had the third biggest renumeration package of any FTSE 100 CEO in 2019 (£11.6 million). It also calculated that the ratio of his single-figure pay to the mean average Diageo staff package was 225:1.
A Diageo spokesperson stated: “Pay reflects performance at Diageo, with long term remuneration awards vesting when performance criteria is met. We have rigorous processes in place to reward staff fairly at every level and are proud of the pay and benefits we offer at Diageo. Last month, we gave every employee £1,000 gross (capped at 15% of local equivalent annual salary), as a special recognition payment for their contribution to our performance in the prior financial year, and to help with the current macro-economic pressures. This payment was additional to our annual bonus scheme and pay review cycle.”
For a full breakdown of Diageo’s financial results, click here.