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Telstra boss Andrew Penn pockets $5.21m

Simone Ziazaris  |  01 Sep 2017Text size  Decrease  Increase  |  

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SYDNEY - [AAP] Telstra (ASX: TLS) boss Andrew Penn will take home $5.2 million this year, almost $1.6 million less than he did a year ago as the telco's plunging share price weighs on his share entitlements.

The Telstra chief executive earned $2.3 million in fixed remuneration for the full year to June 30, $1.49 million in short-term incentives and $1.04 million in long-term incentives, bringing his total pay to $5.21 million, according to Telstra's annual report, which was released on Friday.

While Mr Penn's short-term cash incentives rose, the big decline was in the long-term incentive, which was worth $2.8 million in 2015/16, based on a $5.56 share price, compared to the June 30, 2017 value of $4.30 used this year.

Telstra has also announced it will implement a new remuneration plan in the 2018 financial year which will combine its existing short-term and long-term incentive arrangements into a simplified version and extend the overall plan from four years to five years.

"Our existing long-term incentive plan is complex and we believe a simpler remuneration model is in the interest of shareholders," Telstra said on Friday.

Australia's biggest telco said there will be no change to the maximum opportunity that senior executives can earn.

Telstra shares plunged to a five-year-low on August 17, despite the company lifting full-year profit 1 per cent to $3.9 billion, after it said it will cut future dividends in order to fund network investment and defend its market share.

Mr Penn then defended the move, which will end a longstanding practice to pay almost 100 per cent of underlying profit to shareholders.

The new policy to pay between 70 and 90 per cent of underlying profit will take 2017/18 dividends to 22 cents, from 31 cents this year.

 

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