Page 8 - bne magazine September 2020 russia melting

8 I Companies & Markets bne September 2020
Wizz Air CEO Jozsef Varadi is under pressure over €533,000 bonus payment.
Shareholders rebel against Wizz Air CEO's bonus payment
Tamas Szilagyi in Budapest
Leading UK-based corporate governance groups raised concerns about the possible bonus payment to Wizz Air CEO Jozsef Varadi ahead of the July 28 AGM of the no-frills airline, local media wrote on July 20.
Despite missing the profit target required for the payout, Varadi is expected to receive HUF188mn (€533,000) in bonus payments pending approval from shareholders. Wizz Air's top man's base pay package is €2.8mn per year.
CEE's leading airline's revenue rose 19.1% y/y to €2.76bn in the 2019-2020 business year ended on March 31, as passenger numbers increased by 15.8% y/y to 40mn. Profit for the business year came to €281mn. Management tied bonus payments to €294mn in profit, which was missed due to
the lockdowns.
Glass Lewis and Shareholder Services say the CEO should
not be entitled to a bonus payment as the airline fired 1,000 staff, or 20% of its workforce, at the height of the epidemic and made use of the UK government's furlough scheme. In addition, it tapped the Bank of England’s COVID-19 corporate financing facility for £300mn.
Wizz Air has outperformed other airlines in all categories, Wizz Air's committee in charge of remuneration told Hungarian media.
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From 2014 on it has increased staff from 1,600 to nearly 5,000 in six years, (before reducing it to 4,000). It said it aims to take back its employees as the sector recovers from the pandemic.
The committee said it would be unfair and would not serve shareholders' interests if the extraordinary events were counted in the performance of the airline.
Wizz Air became one of the first airlines in Europe to resume operations from its Luton and Budapest bases in the first days of May. At the height of the crisis, the airline was operating at a 3% capacity.
Wizz Air, based in Budapest, is listed on the London Stock Exchange. Before the crisis, the airline was flying on 710 routes to 154 airports in 45 countries.
In related news, the Hungarian low-cost airline announced
the launch of 14 new routes from Ukrainian airports to Italian cities, but postponed until September the launch of new routes that will connect Serbia's Belgrade to nine European cities.
Due to restrictions imposed by Italy on flights from most of the Western Balkans, Wizz Air’s planned new service from Milan to Pristina, has been delayed.