Executives at Stagecoach have seen their pay packets shrink by about a third after the bus and rail operator failed to hit its profit targets last year.
The latest annual report from the Perth-based transport giant shows that total remuneration for chief executive Martin Griffiths fell to £1.45 million in the year to the end of April, from £2.2m last time.
Finance director Ross Paterson, who succeeded Griffiths in that role in 2013, saw his overall pay deal fall from £1.3m to £945,000.
Writing in the annual report, remuneration committee chairman Phil White said bosses had been set “challenging financial targets” but the group failed to meet a goal of £218.6m in profits before interest and tax because of lower earnings at its North America division and regional bus operations across the UK.
However, White said a strong performance from the firm’s rail business meant earnings per share and net debt came in ahead of targets. He added: “Annual bonus levels of 35 per cent out of a total of 70 per cent available for financial performance has been achieved, resulting in total bonus awards of 65 per cent of salary for both directors.”
Griffiths, who replaced Stagecoach co-founder Sir Brian Souter as chief executive in 2013, received a performance-related bonus of £399,000, down from £600,000 a year earlier, while Paterson’s award was reduced from £400,000 to £267,000.
Both executives also saw sharp falls in the value of their long-term incentive awards.
Souter, who now serves as chairman of the firm that he set up with his sister Ann Gloag in 1980, received fees of £205,000, up from £201,000 last time.
Stagecoach, which runs the east and west coast main lines between Scotland and London in partnership with Virgin, was dealt a blow this week after it failed to extend its South West Trains franchise out of London Waterloo to at least April 2019.
The Department for Transport told the firm that it plans to invite applicants to tender for a new long-term franchise beginning sometime in 2017.