Golden handshake: Jayne Hrdlicka’s $50m Virgin Australia bonanza

Virgin Australia’s former chief executive, Jayne Hrdlicka, departed the recently listed airline with cash and shares worth more than $50 million, according to the group’s annual report released on Friday morning.

Hrdlicka, who took over at the airline soon after its pandemic-induced financial collapse in 2020, left in March this year – months before its successful relisting on the ASX in June.

According to the report, Hrdlicka received cash payments of more than $20 million, with $18.4 million representing short-term incentives which will be paid this month.

But the biggest bonus will be from 10.244 million shares she received as part of a 2021 management equity plan (MEP), which were worth $29.7 million at the time of the airline’s public float but are currently worth about $33 million.

The payout was slammed by the Transport Workers’ Union national secretary Michael Kaine, who represents a large chunk of the airline’s workforce.

“What is eye-watering to the average aviation worker, as well as the Australian public, is the near-$50 million pay packet now handed out to former CEO Jayne Hrdlicka. We cannot continue to see CEOs and executives in aviation pocket obscene salaries while the industry is at breaking point,” he said.

By comparison Cathay Pacific chief executive Ronald Lam Siu-por was paid $HK14.15 million ($2.76 million), including bonuses, last year. British Airways boss Sean Doyle was reported to have received remuneration totalling £1.5 million ($3 million) in 2022/23, including bonuses and incentives.

Singapore Airlines chief executive Goh Choon Phong received an annual salary of $S7 million ($8.2 million) for the latest financial year, ended March 31, according to the airline’s annual report.

Hrdlicka’s incentives are typical of the lucrative bonuses offered by private equity owners such as Bain, which acquired the airline out of administration and sold down its stake in the public sale of the business.

Hrdlicka’s shares are still subject to escrow conditions but will be released between February next year and August 2027.

The former Virgin boss was not mentioned by the airline’s chairman Peter Warne, or her chief-executive replacement Dave Emerson, in their letter to shareholders in the annual report, despite the fact she was running the airline for most of the financial year.

“During her tenure, Jayne successfully led the group’s exit from voluntary administration, stand up of the airline following the COVID-19 pandemic and the transformation of Virgin Australia into a profitable and sustainable business,” the annual report says on page 67.

“In addition, during FY25 Jayne led Virgin Australia’s deeper strategic partnership with the Qatar Airways Group, including a 25 per cent equity investment and enhanced strategic alliance.”

Hrdlicka’s payout is in stark contrast to the controversial departure of her former boss at Qantas, Alan Joyce.

The Qantas board docked more than $9 million from Joyce’s final pay packet for the 2024 financial year following a board-commissioned review of the airline’s management.

He was paid $15 million for his last year leading the company, and received a further $3.8 million worth of shares last year.

Hrdlicka is already moving on to another challenging role. One month after her departure from Virgin, the liquor, pubs and pokies giant Endeavour announced that she would be taking over as its new chief executive.

“I have a long history with Endeavour’s retail and hotel businesses, initially as a consultant to Woolworths, including on their early liquor strategy, and then as a Woolworths Group board member,” she said at the time of her announcement.

The company has already run into turbulence with the sudden resignation last month of Endeavour’s executive chairman Ari Mervis, after a boardroom disagreement. Hrdlicka is due to start her role in January.

Hrdlicka will be paid an annual salary of $2 million, with short-term bonuses of up to $3 million and long-term incentives of $4 million.

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