Michael O'Leary, head of Ryanair, stands to receive an enormous €100 million bonus.
Ryanair CEO Michael O'Leary Nears €100 Million Bonus due to Share Performance
Ryanair's CEO, Michael O'Leary, is edging closer to receiving a substantial €100 million bonus, culminating from a share incentive scheme linked to the airline's stock performance. The scheme, part of a 2019 incentive, hinges on Ryanair shares closing above €21 for 28 consecutive days.
The Irish carrier's shares breached this threshold recently, having maintained a closing price of around €23.28–€23.74 in late May 2023. This consistent growth over nearly a month positions O'Leary to potentially acquire 10 million Ryanair shares at a discounted price of €11.12 each [1][2][3][4].
If O'Leary remains in his position until July 2028, as stipulated, these shares could be worth approximately €126 million [1][2], marking a significant windfall compared to the discounted share price.
O'Leary defends the bonus, arguing that it aligns with the exceptional value delivered to Ryanair shareholders in comparison with high salaries in other sectors, such as Premiership footballers and managers earning up to €25 million annually [1][2]. He insists that the scheme benefits the entire management team, fostering a link between managerial performance and long-term company growth.
Notably, Ryanair's budget rival, Wizz Air, also faces similar controversy regarding its CEO's potential €100 million award subject to share price targets by 2027. CEO József Váradi has compared opposition to Wizz Air's remuneration policy to socialism [2].
Whilst the bonus has attracted criticism due to its substantial scale, Ryanair's management maintains that the incentive scheme rewards shareholder value and supports the airline's long-term growth trajectory [1][2][3][4].
[1] - "Ryanair CEO Michael O'Leary's €100m Bonus: All You Need to Know," Business Insider, August 20, 2023.[2] - "Wizz Air CEO on €100m Bonus: 'We're Delivering Value for Shareholders,'" Reuters, September 5, 2023.[3] - "Michael O'Leary's €100m Ryanair Bonus Faces Controversy," The Guardian, September 8, 2023.[4] - "The Race for €100m: O'Leary and Váradi's Bonus Showdown," Bloomberg, September 12, 2023.
Investing in Ryanair's shares provides an opportunity for business growth, as CEO Michael O'Leary could potentially earn €126 million due to the share performance incentive scheme, with a threshold of 28 consecutive days of share closing above €21. This scheme, linked to the finance sector, aims to foster a business environment that aligns managerial performance with long-term company growth. Similarly, Wizz Air's CEO, József Váradi, faces a potential €100 million award subject to share price targets, reigniting debates about executive compensations in the transport sector.