Jupiter chief executive Andrew Formica has pocketed more than £1m during his first year at the helm of the FTSE 250 fund group, despite another year of heavy redemptions.
Jupiter’s remuneration committee awarded Formica an £892k bonus for his first 10 months on the job on top of his £422k fixed remuneration package, which includes a £371k base salary. In total he walked away with £1.3m.
Formica’s total remuneration for the year was still less than the £2m Maarten Slendebroek was awarded in 2018. In the two months he remained as chief executive of the business Slendebroek scooped up £614k.
Top executives at the firm including Wayne Mepham, who Formica poached from Schroders shortly after joining, and vice chairman Edward Bonham Carter raked in a total of £3.3m in 2019.
Formica performance rated ‘outstanding’
The remuneration committee judged Formica’s performance over the period as “outstanding”, citing his achievements in overhauling the firm’s strategic direction and senior management through recruiting new CFO Mepham and global head of distribution Phil Wagstaff.
Former chief executive Maarten Slendebroek was given a “very good rating” by contrast. The committee said 75% of his bonus was determined based on the corporate financial metrics of 2019 and 25% in relation to his personal performance goals.
The most dramatic change for Jupiter has come this year with the announcement it will be acquiring Merian for £370m.
Seven Investment Manager senior portfolio manager Peter Sleep said by the time the committee was writing up Formica’s assessment for the annual report it would have likely known about the M&A deal.
Jupiter misses flows target
The generous pay packages come during a year when Jupiter was hit by more net outflows.
Three quarters of the bonus metrics were determined by measures relating to profitability, flows and investment outperformance.
In 2019 the group was not able to reverse the tide of redemptions after losing Alexander Darwall, one of its star managers. Darwall’s departure from the European Growth fund, one of Jupiter’s biggest strategies, triggered £4.3bn to fly out the door.
While Jupiter fell short on the flows component, it said profits for the year, which were down 15% to £151m, were between target and maximum level.
Investment performance across its unit trusts and Sicav funds “remained strong over three years” with 65% of strategies in the first or second quartile. But performance for its segregated mandates and investment trusts was “disappointing” with only 16% outperforming over a one and three year weighted average.
