Remuneration for all board members is reduced 50% and chief financial officer (CFO) Mark Reid steps down with Julian Maurice-Williams promoted to acting CFO from his role as financial controller. Although the saving in pure monetary terms is pretty modest - $1.5 million over the next year – it sends out the right message.
Even after today's rise the stock still trades at a discount to its net cash of £36.2 million – an anomaly we discussed here.
The reduction in overheads should give Chariot even greater breathing room in its effort to farm-out its interests in assets in Namibia, Brazil, Mauritania and Morocco. Third party drilling over the next 24 months could support interest from potential partners.
FinnCap analyst Dougie Youngson comments on today's news. 'Given the current market conditions, we view this emphasis on capital discipline positively.'
Director pay at natural resources companies remains an issue and still seems to be out of whack with the miserable performance of the sector. BG (BG.) faced pressure from shareholder lobby groups ahead of its annual general meeting this morning over plans to pay new boss Helge Lund £25 million for what is essentially a caretaker role after the agreed £47 billion tie-up with Royal Dutch Shell (RDSB). There was a tussle over Lund's pay even before he was appointed in February.
KPMG's Guide to Directors' Remuneration 2014 shows the upper quartile basic salaries for chief executives in the FTSE 350 were highest in the natural resources and energy space at £939,000 a year.