British Gas: Centrica CEO’s pay slashed in half at FTSE 100 giant
The boss of Centrica, the FTSE 100 parent company of British Gas, has seen his pay slashed by almost half for the group’s latest financial year.
Chris O’Shea took home £4.3m for the 12 months, down from the £8.2m he received in the prior year.
O’Shea, who has been CEO of the FTSE 100 company since 2020, had previously received £4.49m in 2022.
His latest pay packet included a base salary of £845,000, £1.4m from the annual incentive plan and £2m from the long-term incentive plan.
Last year’s package consisted of £810,000 in salary, a £1.4m annual bonus and £5.9m in long-term bonus, and some pension and benefits.
However, the owner of British Gas added that O’Shea’s “remuneration is no longer sufficiently aligned with our peers, and his performance and experience warrants positioning his pay between the median and upper quartile of the FTSE 100”.
As a result, the group confirmed it will increase the CEO’s salary from £855,000 to £1.1m from 1 April.
Centrica also confirmed that O’Shea’s maximum RSP (Restricted Share Plan) award would be increased from 150 per cent of salary to 200 per cent.
British Gas owner backs salary hike
The group said: “The committee considered whether the increase should be phased over multiple years.
“However, considering the CEO’s track record and experience as well as the current positioning versus the market, the committee determined that it would be inappropriate to continue to pay him below market competitive rates and therefore decided to implement a one-off adjustment.
“This also reflects the prudent decisions taken over the past four years, which restrained the committee from applying phased relative increases up to this point.”
Centrica’s annual report comes after the owner of British Gas beat earnings estimates for its latest financial year and hiked its dividend.
The group posted earnings before interest, taxation, depreciation and amortisation (EBITDA) of £2.3bn for the 12 months ended 31 December.
While this was down from last year’s £3.5bn, it was well ahead of analyst expectations of £1.6bn.
Adjusted earnings per share came in at 19p, ahead of prior forecasts of 18.62p.
Centrica added that it planned to hike its dividend by 13 per cent to 4.5p and extended its existing share buyback programme by £500m.
In its annual report, the owner of British Gas said: “Our performance in 2024 demonstrates that our business model is resilient in different market conditions, and we are well placed to benefit from the transition to net zero.”