If MyTravel's financial woes have put you off booking one of their sun, sea and sex package holidays for fear that standards may have slipped then worry not: the troubled travel group has the answer. It is giving Peter McHugh, its chief executive, £25,000 to spend on testing out the group's holidays for himself in the current financial year - all in the name of research, obviously.
Mr McHugh's "product review allowance" forms just an iota of the staggering £8.6m the troubled travel company paid out to its directors last year, a year that saw MyTravel clock up the biggest losses ever reported by a package holiday company at £911m. Bumper compensation payouts to discredited former directors, including the man who presided over the group's near financial ruin, Tim Byrne, helped the total directors' wage bill to double from the £4.4m paid out during the previous year.
Yesterday the company's annual report and accounts revealed that Kazia Kantor, MyTravel's finance director for less than nine months, pocketed a £606,000 payoff, while Mike Lee, the former aviation director, was given £1.1m to ease his departure from the group last March. In total, the group paid five former executive directors £4.5m, apparently ignoring their role in the company's downfall: its market valuation has collapsed from £1.2bn less than two years ago to £64m yesterday.
The report showed that Mr McHugh, who used to run the group's now defunct North American arm, saw his total pay double to £909,000 from £486,000. Although neither Mr McHugh nor his fellow directors was paid a bonus last year, the company's decision to abandon the conventional practice of awarding share options in favour of a new cash incentive scheme means Mr McHugh could receive a bonus of £1.6m on top of his £535,000 base salary this year. A spokesman said the company's "very low proportion of equity to debt [some £1.3bn]" meant it "wasn't appropriate to link incentives solely to the performance of the equity".
Separately, the group said it is paying John Darlington, a turnaround specialist called in to rescue such basket cases as the Millennium Dome and HP Bulmer, £40,000 a month, on top of £120,000 last year.Reuse content