The year 2021 was a better time to be in dry bulk than in tankers, and that was proven in the compensation of public management teams as well.
Executives of the three US-domiciled dry bulk shipowners all saw their compensation rise, while those for the one internationally trading tanker company to itemise pay took a dip.
As TradeWinds has reported, Eagle Bulk Shipping chief executive Gary Vogel was rewarded for the Stamford company’s big year with a doubling of his compensation package to $3.4m.
As it turns out, that makes Vogel the compensation king for the reporting US shipowners as well.
Vogel edged out an executive whose pay dropped. International Seaways chief executive Lois Zabrocky saw a total package of $3.04m, down from $3.37m in a tanker market that continued to struggle with a decades low rate environment.
There is a big caveat while we are talking about these comparisons, however.
US securities regulations require itemised reporting from companies with their base here, but not from those who are domiciled abroad — which is almost the entire roster of New York-listed shipowners.
The latter benefit from looser rules applied to foreign filers as a form of incentive to list on US exchanges. They report only lump-sum compensation totals for management teams.
And while Streetwise is a financial newsletter rather than an environmental, social and governance one, how is it again that the ESG crowd has not gotten around to making life tougher for the minimalist reporters?
(Belgian tanker giant Euronav is a significant exception, voluntarily breaking down its pay scheme with its annual report. Chief executive Hugo De Stoop reported total pay of €958,000 — about $1.02m — for 2021.)
Otherwise, it is only Eagle Bulk, International Seaways, Genco Shipping & Trading and Pangaea Logistics Solutions that currently fall into this select category of international traders/domestic filers.
They are some of the most responsible outfits in the sector, with Eagle, Genco and International Seaways regularly placing in the top five of analyst Michael Webber’s ESG scorecard for overall excellence.
New York-based bulker owner Genco finished at the very top of that list for 2021, and Genco chief executive John Wobensmith also had a good year both for his company and his personal coffers.
It was just not quite as good as Vogel.
Wobensmith received a total package valued at $2.6m, about an 18% raise over his 2020 figure of $2.2m. The full difference came in a $1m cash bonus, up from a $540,000 award in the prior year.
Genco’s second earner was chief financial officer Apostolos Zafiolas at $954,000, a sizeable jump from the $681,000 granted a year earlier. As with Wobensmith, most of the difference came in a cash bonus of $402,000 against $175,000.
A few blocks away at International Seaways, Zabrocky saw her pay drop largely on the basis of a smaller cash bonus. This tumbled to $673,000 from $971,000. The company had run outsized profits in the first half of 2020 before the tanker market imploded.
Chief financial officer Jeff Pribor saw compensation sliced to $1.76m from $1.9m, as his cash bonus narrowed to $399,000 from $589,000.
Besides being in different operating sectors, International Seaways, Genco and Eagle are of similar size. International Seaways currently features a market capitalisation near $1.1bn, with Genco at $985m and Eagle at $926m.
Eagle shares gained nearly 240% in 2021 and Genco’s jumped about 210%, while International Seaways declined about 13%.
Rhode Island-based niche market specialist Pangaea Logistics is substantially smaller than the other reporting companies with a market capitalisation of around $227m. Yet it consistently earns market-leading premiums to the Baltic dry indices through its contract coverage and specialised trades.
Its executives also benefited from the better market. Former chief executive Ed Coll received total compensation of $1.36m from $1.2m a year earlier, with a cash bonus rising to $1.1m from $940,000. Coll died last December.
Successor Mark Filanowski was promoted from chief operating officer, and saw compensation nearly double to $995,000 from $529,000. The difference was a cash bonus of $750,000 from $300,000.
Pangaea’s share price increased about 35% in 2021.
More ship finance news
- New York-listed International Seaways is beginning to see the positive impact of its 2021 Diamond S Shipping takeover as it becomes the latest owner to confirm improving rates for its aframax and clean-products tankers for bookings in the current quarter. Click here to read.
- Russia’s sanctioned shipping company Sovcomflot (SCF Group) is trying to find a way to meet European bond commitments after its payment agent refused to handle an instalment. Click here to read.
- Hafnia is kicking the tyres on a $100m private placement in an effort to capitalise on the expected improvements in the tanker market. Click here to read.
