Rolls-Royce CEO's pay drops by almost £10m

(Sharecast News) - Rolls-Royce chief executive officer Tufan Erginbilgic saw his pay package drop by nearly £10m in 2024, it emerged on Thursday, despite leading the company through a dramatic financial turnaround. His total remuneration fell to £4.1m from £13.6m in the prior year, largely due to the expiration of a one-time £7.5m share award he received upon joining Rolls-Royce to compensate for lost earnings from his previous role.

The reduction also reflected a decrease in Erginbilgic's annual incentive plan payout, which dropped from £4.6m to £2.5m under an older compensation structure.

Rolls-Royce had since revised its executive remuneration scheme, introducing separate bonus and long-term incentive plans for future years.

While his total pay fell, Erginbilgic's base salary rose from £875,000 to £1.1m and was set for a further 5% increase in 2025.

His pay adjustments came amid a period of significant recovery for Rolls-Royce, which recently reinstated dividends, launched a £1bn share buyback and upgraded its profit forecast for 2024.

Since taking over in early 2023, Erginbilgic had overseen a restructuring of the company, including the elimination of 2,500 jobs and efforts to resolve long-standing supply chain disruptions.

Under his leadership, Rolls-Royce's share price had surged from around 150p to over 800p, with a notable rise following a recent London defence summit where European leaders reaffirmed their commitment to increased military spending.

The company's recent financial success marked a stark contrast to the difficulties faced in previous years when the pandemic severely impacted its aviation business, forcing Rolls-Royce to raise emergency funding.

Reporting by Josh White for Sharecast.com.