- Royal Caribbean said Wednesday that its CEO would forego his income until September in the wake of the coronavirus.
- Other executives are taking a 25%pay cut as the pandemic brings the industry to its knees.
- Richard Fain, who has actually been the business’s CEO for years, will likely still see significant settlement in the type of stock options.
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Royal Caribbean’s CEO has actually volunteered to not take a wage through the end of September, the business said Wednesday, with three other executives taking a 25%pay cut as the coronavirus pandemic triggers a major headache for the cruise market.
Richard Fain, who has actually helmed the company because 1988, has an income of $1.1 million, according to regulative filings. However, his payment also included a $3.5 million bonus and $5.8 million in non-cash pay. Coupled with his shares in the company, Fain took house nearly $25 million in2018
The other executives seeing a 25%pay cut include CFO Jason Liberty, Michael Bayley, CEO of Royal Caribbean International, and Lisa Lutoff-Perlo, CEO of Celebrity Cruises.
” These decreases were made in light of the COVID-19 pandemic and the negative financial and functional effects resulting therefrom,” Royal Caribbean said.
Wednesday’s statement follows Royal Caribbean, together with much of its major competitors, was required to stop all cruisings for the time being
” Cruise lines, as evidenced by the stocks, remain in a world of hurt right now without a clear light at the end of the tunnel,” Patrick Scholes, a SunTrust Robinson Humphrey expert, informed Service Insider’s Meghan Morris in March
Scholes said that with ships stopped, the public companies could pay their financial commitments for the next six to 9 months.
” Under typical scenarios, that’s not the end of the world; here the multitrillion concern is when do ships start cruising again?” he said.
To make matters worse, it’s possible that cruise lines won’t see a single cent of the enormous financial help bundle gone by the United States government in response to the pandemic, thanks to their so-called flags of convenience. Under that practice, lots of cruise lines register their ships in foreign nations to skirt United States regulations, like labor laws.
” It would be very difficult for political leaders to defend the cruise market getting a potential bailout when they don’t pay US corporate taxes,” Steve Wieczynski, an analyst at Stifel Financial, said in current notes to clients.