Ryanair's Michael O'Leary lands historic bonus of €100m in shares jackpot

Belfast Telegraph

3 days ago

The Irishman qualified for the mammoth payout on Thursday after Ryanair stock traded above the specified level of €21 for a 28th straight day, closing at €23.74.
Mr O'Leary now stands to receive 10m shares for €11.12 apiece, or €111.2m in total. Based on Thursday's closing price, the stock would be worth €237m, bagging a paper profit of €126m.
He signalled on Monday that he could stay on as chief executive of the airline when his current five-year contract expires in 2028, when he will be 67.
'I think we're delivering exceptional value for Ryanair shareholders in an era when premiership footballers and managers are getting paid £20m and £25m a year,' he said, as Ryanair published full-year results on Monday. 'I think Ryanair shareholders are getting particular value out of our share options – both mine and the rest of the management team.'
Mr O'Leary's current stake in Ryanair is worth more than €950m and he receives a basic salary of €1.2m a year.
'My contract runs out in 2028 and there'll have to be some discussion I presume with the board... as to how my remuneration will be fixed from 2028 onwards, if they want me to stay on after 2028,' he added.
He has made hundreds of millions of euro from the airline since he joined in 1988. He became chief executive in 1994 and transformed the carrier into one of the world's biggest.
His lucrative deal with Ryanair will see him secure share options in the airline if its share price trades above €21 for 28 consecutive days, or if the airline generates an annual profit of €2.2bn any time up to 2028.
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Ryanair said its full-year profit after tax in its financial year that ended in March tumbled 16pc to €1.6bn despite passenger numbers jumping 9pc to 200.2 million. Its average fares fell 7pc in the year, hurting the bottom line.
Despite that, shares in the airline were about 3.5pc higher at €23.21 on Monday morning amid an optimistic outlook, with fare price recovery, oil prices trending down and tight cost maintenance all lifting investor sentiment.
The shares have been changing hands at more than €21 since May 2.
Under a long-term incentive plan, Mr O'Leary will be awarded 10 million shares in Ryanair, at a strike price of €11.12, if either the share or profit performance required is achieved.
That means in 2028, if the options have been granted, he can buy the shares for €11.12 each no matter what the share price at that time is. If in 2028 the shares were even trading at the level they are now, that would see a more than €100m pre-tax gain for the outspoken airline boss.
'The options don't vest until 2028,' said Mr O'Leary. 'We may achieve the targets either later on this month or later on this year, but none of those options vest until 2028. I and the rest of the management team have to stay here until 2028 and continue to deliver before we can actually get hold of those share options.
'I accept there is a possibility we might achieve the performance target either later this month or later this year,' he added.
'The chance of a follow-on scheme is pretty limited,' he added. 'The board, about three or four years ago, moved away from share options. For the last three years, certainly the senior management team have been getting LTIPs (long-term incentive plans), which are awarded every two years and that seems to be a quieter and more reasonable way of rewarding superior management performance.'