Remuneration report
FY24 CEO Performance
Priority
Performance
Strategy and Development
• Refreshed strategy to support next phase of growth endorsed by the Board • Significant engagement undertaken with all key stakeholder groups and primary relationships • Ongoing engagement in relation to NSW toll reform and the Westgate Tunnel project • Continued strong progress against 2030 GHG emissions reductions targets • Portfolio expansion, enhancement and development opportunities progressing in all markets
Customer and Delivery
• Enhancements to the customer value proposition and digital experience resulting in higher adoption rates of the Linkt app and expansion of Linkt Rewards program • Major projects on budget and ahead on delivery including new projects such as the M7/M12 Integration Project • Refreshed operating model and executive committee announced • Active review of culture-related business and governance practices • Ongoing investment in leadership capability with a particular focus on resilience and leading through change; stable overall employee engagement through period of significant change • Continued focus on positive workplace equity including maintaining 40:40:40 gender representation and gender pay parity target, and number one ranking on Equileap’s 2024 Gender Equality Global Report
People and Leadership
Operations
• Renewed focus on importance of operational excellence and a strong safety and risk culture • Constructive support provided to the NSW government on Rozelle Interchange challenges • Delivered significant operational improvements across WCX
Financials
• FY24 distribution of 62 cents per share represents a growth of 6.9% from prior year and is 102% covered by Free Cash • Proportional toll revenue and proportional EBITDA grew by 6.7% and 7.5% respectively, whilst proportional total cost growth was limited to 3.6% • The balance sheet has remained strong with robust debt covenants, credit ratings and liquidity levels. The Group’s weighted average cost of debt is 4.5%
Michelle Jablko transitioned from her former role as Group CFO into the role of CEO on 19 October 2023, at the closing of the 2023 AGM. Through the transition period, Michelle maintained full focus and attention on her responsibilities as CFO. She additionally took on key transitional accountabilities including progressing the appointment of the President of North America and her CFO replacement. A positive legacy of effective financial management practices and investor engagement also ensured a smooth transition for the incoming CFO. Since taking up her role as CEO, Michelle has spent considerable time engaging with and listening to key stakeholders. This has informed a refreshed strategy, since endorsed by the Board, as well as a new operating model and executive line up. Other key areas of focus have been on improving value for customers, establishing effective relationships with government, construction and joint venture partners and undertaking culture and governance reviews across the organisation.
The Board assessed the CEO’s performance against the overall Group results as well as her individual KPIs, with a view to ensuring alignment with the experience and expectations of Transurban’s security holders and other stakeholders. This has resulted in a final STI outcome of 61% of her maximum opportunity (or 92% of her target opportunity). Former CEO FY24 STI Former CEO, Scott Charlton ceased his role as KMP on 19 October 2023 and departed Transurban on 30 November 2023. Individual KPIs were established for the time he served during the FY24 performance period, leading to eligibility to receive an FY24 STI. These KPIs were designed to reflect the different transition phases and shifting role requirements during the period, in addition to overall group performance.
The STI opportunity included two components;
a) an ‘at target’ component to be assessed against the KPIs at the end of 1H24, and b) a ‘stretch’ component to be assessed against the KPIs once the full financial year performance results are finalised, at the end of FY24. This approach was designed to best reflect the timing of departure and the opportunity for outperformance. The Board assessed the former CEO’s performance for the period served against individual FY24 KPIs both at the end of 1H24 and again at the end of FY24. In its assessment at the end of 1H24 regarding the first STI component, the Board determined that the former CEO had met expectations and approved a prorated ‘at target’ cash payment of $648,733, equivalent to 93% of his target opportunity for the period he was a KMP. This was awarded as a cash payment in February 2024. No further awards were made to the former CEO.
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