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Whitehaven Coal Limited : Annual Report 2012
Whitehaven Coal Limited -- Annual Report 2012 43 The Board sought independent advice from Egan Associates to assist in benchmarking remuneration reflective of the merged entity's enhanced scale and challenges. Fixed remuneration was benchmarked at the market median with the 'at risk' performance components of remuneration more closely reflecting current market practice (including deferral of a portion of the short term incentives). The Merger has resulted in the size of the key management personnel (KMP) team being substantially reduced from that which previously existed across the various merged entities. While there have been adjustments to reflect the new reward levels of the KMP in line with the Company's market position, the total KMP remuneration expenditure is lower as a merged group than it was as standalone entities. As you will see in reviewing this report, some of the Directors and senior executives received payments on completion of the Merger. This was largely due to the acceleration of payments under the Company's previous short and long term incentive plans, which was considered appropriate in light of the Company's performance up to the date of the Merger. Key highlights of the Company's performance during FY2012 include: • Underlying net profit after tax (NPAT), before significant items, of $57.8 million; • NPAT after significant items of $62.5 million; • Saleable coal production up 3% (equity basis) to 4.28 Mtpa, and up 4% to 4.90 Mtpa (100% basis); • Equity ROM coal production increased slightly to 4.66 Mtpa for the year. This was lower than anticipated due largely to significant impacts of exceptional wet weather in the December and March quarters and consequential mine scheduling issues; • The Narrabri longwall was installed in the June quarter and is currently being commissioned. First longwall coal was cut on 12 June 2012, with over 300 Kt of longwall coal produced to the end of August 2012. Acceleration of entitlements under the Company's incentive plans was also considered desirable in order to place employees of Whitehaven Coal, Aston Resources and Boardwalk on a level playing field and to pave the way for the new remuneration arrangements to be put in place for all employees of the merged entity (with effect from 1 May 2012). The remuneration outcomes disclosed in this report for FY2012 are therefore distorted by the one-off impact of the Merger. Going forward, the new remuneration arrangements will better reinforce alignment between the Company's performance and remuneration to executives. The following Remuneration Report provides a summary of KMP entitlements to 30 April 2012 (the date immediately prior to the Merger), remuneration which crystallised at the time of the Merger, and the remuneration levels and new remuneration framework which has been progressively implemented since 1 May 2012.
Annual Report 2011
Annual Report 2013