From Bloomberg via Rigzone:
One of the oil industry's highest-paid executives is taking a pay cut as his company braces for possibly difficult times ahead after its stock plunged last year.
Nabors Industries Ltd. Chief Executive Officer Anthony Petrello agreed to forfeit $4 million in restricted stock , in exchange for a symbolic award worth $1,500.
The CEO’s salary is also dropping 10 percent this year to $1.58 million.
Shares of Nabors, the world’s largest owner of onshore drilling rigs, tumbled 71 percent last year, the third-worst performance in the 15-company Philadelphia Oil Services Index. The firm is more exposed than rivals to international markets, which have lagged behind the U.S. in recovering from the worst crude crash in a generation four years ago.
“It’s just recognizing we could be in for a rough patch, we may have to take some actions to tighten the belt, and the first belt we’re going to tighten is on the executive officers,” said Nabors spokesman Dennis Smith. “The top guy shouldn’t be immune.”
The recent announcement by Saudi Arabia to curtail output in light of lower oil prices could dampen activity for companies working there, including Nabors.
It’s unclear if the pay cuts will be enough to satisfy investors. The stock is down about 86 percent since Petrello, 64, became CEO in October 2011, far worse than drillers Patterson-UTI Energy Inc. and Helmerich & Payne Inc. Over that period, he’s taken home $133.6 million, counting cash compensation, perks, vested stock awards and exercised options. That’s more than double what the two rivals paid its top leaders.
Investors have voiced discontent with the firm’s pay practices and governance. Since 2011, Nabors has received 42 percent support on average in its annual advisory vote on executive compensation, and shareholders have repeatedly withheld votes for directors. Support levels on pay below 80 percent are rare at publicly traded U.S. firms.I assume investors can always invest elsewhere.
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