In a decision that surprised brokers, Telecom sent a media statement announcing that chief executive Paul Reynolds received total remuneration of $5.2 million during the year ended June 30.
The total included base salary, performance-assessed short-term incentive and special payments.
The information was released before the publication of Telecom's annual report which would be published along with Telecom's demerger scheme booklet later this month and came the day the Rugby World Cup started in New Zealand.
In the past, governments have used holidays such as Easter, Labour Weekend and the start of Christmas holidays to release controversial Bills. They are usually accompanied by a short date for public submissions.
Brokers spoken to by the Otago Daily Times said it was unusual the announcement went direct to the media and not through the NZX, which had still not carried the announcement two hours after receipt of the email.
Telecom chairman Wayne Boyd and Dr Reynolds have both announced they are leaving the company.
Mr Boyd said in a statement that Telecom had experienced a very strong year, including reaching agreement with the Crown for partnership on both ultra-fast broadband and the rural broadband initiative, at the same time as delivering a strong operational performance.
The improvement in operations, despite a challenging operating environment, ended in a 66% increase in adjusted net profit for the second half of the year and adjusted operating profit growth for the first time since 2006.
However, what Mr Boyd did not point out in his statement that the improved operating earnings were achieved only after Telecom removed from its balance sheet about $300 million of losses attributed to the Christchurch earthquakes and asset impairments. Telecom also removed from the equation $88 million of tax it did not have to pay while including a $18 million gain on the sale of AAPT consumer.
Mr Boyd said that it was the view of the board that Dr Reynolds had more than achieved the objectives set for him and his team at the start of the financial year and that was reflected in his remuneration for the period.
Mr Boyd also noted that share rights, worth $583,333 when they were granted three years ago, had lapsed.
The share rights were issued to Dr Reynolds under his long-term incentive scheme but as the specified performance hurdles had not been met he would receive no value for them.
"Dr Reynolds' package was an appropriate balance of short-term incentives that relate to objectives that are relevant for each financial year and long-term incentives that relate to overall shareholder value targets over a multi-year period.
As the lapsing of the tranche of share rights, and the year-on-year variability in the short-term incentive value demonstrated, a large component of the remuneration was at risk and strongly correlated to the overall performance of the company, Mr Boyd said.
