Crown Resorts pays out nearly $24m to departing executives, including Ken Barton
Crown Resorts paid almost $24m to outgoing executives in the 2021 financial year following a cavalcade of inquiries that threaten the James Packer-backed group’s casino licences.
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Crown Resorts paid nearly $24m to outgoing executives in the 2021 financial year following a cavalcade of state government inquiries that threaten the James Packer-backed group’s casino licences.
The remuneration figures were contained in Crown’s annual report, which also contained a warning from auditor KPMG that there is “significant doubt” that the embattled gaming giant will be able to continue as a “going concern” due to the impact of Covid and regulatory burdens of the current royal commissions into its West Australian and Victorian casino licences that have put the group at risk of defaulting on their loans.
The $6.6bn group, which booked a $261.1m full-year loss last week, has also been temporarily prevented from opening the gaming floor at its Sydney casino hotel due to the findings of NSW’s Bergin inquiry in February.
The inquiry and royal commissions have led to an exodus of long-time directors and executives, many due to what the Bergin inquiry considered an inappropriately close connection to Crown’s 37 per cent shareholder James Packer, while others have called time after an incredibly stressful period for the company.
As a result, Crown’s statutory costs of payments to former and current senior executives surged 69 per cent to $23.7m in the 2021 financial year, with long-time Crown executives collecting large termination packages on the way out.
Former chief executive and chief financial officer Ken Barton received nearly $6.3m – almost twice what he earned the year before due to a $3.5m termination benefit.
Mr Barton, who resigned in February after being described by the Bergin inquiry as “no match for what is needed at the helm of a casino licensee” also benefited from a fixed-term consultancy agreement which concluded on Wednesday, but the value of this was not disclosed
As a “good leaver”, he has also retained more than 8.5 million options in Crown’s digital business that were granted with an exercise price of $1.45. They expire in December 2022.
Former executive chairman John Alexander, who stepped down during the Bergin inquiry before departing Crown in January, received just over $2.5m.
The group’s former Australian Resorts CEO Barry Felstead received about $4.7m, including a $3.2m termination benefit. Former executive vice-president of strategy and development Todd Nisbet received a whopping $6.6m, about half of which was a termination benefit.
These figures do not include the annual and long service leave accrued by the four men, which tops $7.2m in total.
Xavier Walsh – who stepped down as CEO of Crown Melbourne after the Victorian royal commission revealed he had known about a gaming tax underpayment issue since 2018 – received just over $792,000 in payments and benefits.
Crown Sydney CEO Peter Crinis, who is departing at the end of the year, received just shy of $700,000.
The cost of Crown’s board was moderate, with nine directors resigning including adman Harold Mitchell and ex-AFL boss Andrew Demetriou, while just two were on-boarded during the 2021 financial year.
Overall, fees paid to directors over the year rose only slightly to $2.24m from just over $2m. It does not include the executive fee earned by former executive chair Helen Coonan.
Ms Coonan, who was appointed chair in January before becoming executive chair the next month when Ken Barton resigned, received just over $1.3m of her $2.5m salary. She stepped down on August 27.
Incoming CEO and CEO of Crown’s Melbourne Casino Steve McCann will be paid $2.5m annually, with potential for the payout of a further $5m through incentives.
CFO and company secretary Alan McGregor will be paid $1.1m annually, with the potential to earn a further $1.1m through short and long-term incentives. That is up from the $923,284 he received in the 2021 financial year.
Incoming chair and former Telstra boss Ziggy Switkowski’s remuneration has not been settled, although the chairman’s fee for the 2021 financial year was set at $700,000.
However, Crown did say it would be seeking shareholder approval to lift the total cap on non-executive director’s fees from $2.5m to $3m to “take into account the increased number of independent non-executive directors expected to be serving on the Crown board in the future”.
In an auditors’ note KPMG warned there was “material uncertainty related to going concern”, citing pressures from Covid-19 and the ongoing legal and regulatory matters.
Shares in Crown Resorts closed at $9.76 on Thursday, down 1.5 per cent.
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