Willie Walsh's bonus shot down as Iberia airline's performance nosedives

Spanish airline Iberia's dire performance cost International Airlines Group boss Willie Walsh his annual bonus today.

IAG owns British Airways, which made an operating profit of €347 million (£299 million) last year. But this was more than wiped out by Iberia’s €351 million losses as the group crashed €997 million into the red.

Walsh picked up a total of £1.08 million in salary and benefits last year, £215,000 down on 2011. His basic salary was frozen at £825,000 for the second year in a row. The firm’s annual report said the chief executive would have been entitled to a bonus this year, but the board “decided to exercise its discretion to withhold the payment” given the poor financial performance of the group.

Walsh — said to be “relaxed” about the decision — could pick up a maximum £1.65 million in shares over the next three years under a long-term incentive plan if he manages to revive the group’s fortunes. The previous three-year incentive scheme failed to pay out.

He also took home less than British Airways chief executive Keith Williams, whose £1.36 million pay included a a £488,000 bonus in cash and deferred shares. In contrast, Iberia chief executive Rafael Sánchez-Lozano received no bonus and took a 25 per cent pay cut last December.