Ellison takes pay cut as MinRes profit falls

Mineral Resources managing director Chris Ellison’s base salary will be reduced by $300,000, as the miner’s full-year net profit after tax slumped 39 per cent to $165 million.

Mr Ellison will now receive a base salary of $1.2 million a year, but his short-term incentive bonus has increased from a maximum of 50 per cent of his base salary to 100 per cent.

His long-term incentive maximum remains unchanged at 180 per cent, and MinRes said the changes would decrease Mr Ellison's total maximum pay by close to 9 per cent for the 2020 financial year.

MinRes was hit with a 63.3 per cent strike against executive pay by shareholders at its previous annual general meeting late last year.

Revenue fell 7 per cent to $1.51 billion for the 2019 financial year.

MinRes recorded normalised earnings before interest, tax, depreciation and amortisation of $433 million, which was 14 per cent lower than the fiscal year prior, but 15 per cent higher than its midpoint of previous guidance.

It said the fall in revenue and underlying earnings was driven by a fall in lithium prices, delays in the completion of its acquisition and start-up of the Koolyanobbing iron ore mine from Cleveland Cliffs, and a delay in construction of its Wodgina lithium plant.

Earlier this year, MinRes said it expected to commence construction of the Wodgina plant by the end of this calendar year, but now anticipated a start in 2021.

Its mining services division was its best performer, achieving 39 per cent growth in underlying earnings to $260 million from revenue of $850 million.

MinRes said it expected the favourable conditions for its mining services business to continue this fiscal year, and forecast underlying earnings of between $280 million and $300 million.

It will pay a fully-franked dividend of 31 cents.

Shares in the company were down 0.8 per cent to trade at $13.4 each.