Pura Vida Energy, an ASX-listed oil explorer focused on Africa, has informed that its directors have agreed to salary cuts as part of company’s cost reduction program.
The company said both its executive and non-executive directors agreed to reduce their remuneration, a decision which „demonstrates the Board’s continuing commitment to reduce corporate costs in order to preserve its cash position.“
Under the agreed changes, non-executive directors will see their salaries reduced from $100.000 to $25.000 per year.
The managing director will see his base salary cut from $385.000 to $300.000, and incentive awards under the company’s remuneration policy have been suspended.
Also, Pura Vida said Managing Director may receive a percentage of cash received in respect of farmouts, asset sales and other cash generating transactions relating to the company’s existing and future asset portfolio. Any payments are capped at a maximum of 2% of cash received, reducing incrementally over three years to 0%.
The latest salary reductions are in addition to the continuing cost reduction initiatives previously undertaken by Pura Vida, which included employee reductions, closure of Melbourne office and minimization of external service providers, travel, compliance and other costs.
As previously advised, Pura Vida said, these initiatives are on track to achieve a cost saving of $1.2 to $1.5 million on non-operational expenditure during the current financial year. The latest reductions in salaries and will lead to further annualised cost savings going forward
In addition to the salary cuts, the oil company announced board changes, citing a move to reposition the company „to reflect current market conditions.“
Under the „repositioning“ Jeff Dowling has resigned from the Board as non-executive Chairman; existing non-executive director, Ric Malcolm, has been appointed as independent, non-executive interim Chair; and Nathan Lude has been appointed as a non-executive director.
Pura Vida said it is proposed that Malcolm will act as interim Chair whilst the company undertakes a search for a new Chairman-
Damon Neaves, the Company’s Managing Director, will continue in the same capacity.
Managing Director, Damon Neaves, said: “On behalf of the Board, I would like to sincerely thank Jeff for his valuable contribution as Chairman over the past two years. I also take this opportunity to welcome Nathan to the Board and look forward to working together to meet the challenges ahead. The newly constituted Board has reviewed the Company strategy and reaffirmed the direction of the strategy and the importance of a disciplined approach to cost control.”