R62 million payday for South African wealth management boss

PSG Konsult CEO Francois Gouws scored a R62.4 million salary in the group’s 2019 financial year, boosted by a R38.5 million payout as part of his long term incentives.

PSG Konsult is part of the PSG Group founded by South African billionaire Jannie Mouton, which has investments in a wide variety of sectors, including financial services, banking, private equity, agriculture and education.

Mouton, known as the “Boere Buffett” for his successes on the stock market, founded PSG in 1995 and has seen it grow into one of the country’s biggest business success stories.

PSG Konsult is the financial services arm of the group, that focuses on financial products for individuals and enterprises, including asset and wealth management and insurance products in South Africa, Namibia and Botswana.

It is listed separately from the PSG Group, which has a 59.4% shareholding in the company.

Financial performance

In April 2019, PSG Konsult reported an increase in recurring headline earnings per share of 4% for the year ended February 2019, and achieved return on equity of 21.5%.

Core income climbed 10% to R4.6 billion, the group said, adding that total assets under management increased by 8% to R222 billion, comprising assets managed by PSG Wealth of R175 billion (7% increase) and PSG Asset Management of R47 billion (11% increase), while PSG Insure’s gross written premium amounted to R4.5 billion (36% increase).

Additional highlights from its financial results included:

  • Recurring headline earnings per share up 4% to 44.6 cents;
  • Gross written premium up 36% to R4.5 billion;
  • Number of advisers up 19% to 932 people;
  • Dividend per share up 14% to 20.5 cents;
  • Total assets under administration  up 5% to R422 billion.

Executive pay

On the back of its solid results, executive directors and non-executive directors were paid a combined R165 million for the year, with the top two executives taking home R75 million.

Gouws was paid R62.36 million, including a basic salary of R4.8 million and a performance bonus of R18.8 million. He also benefitted from a long-term incentive payout of R38.5 million.

Data from Deloitte showed that executives in the financial, property and investment services (FPI) sector, earned an average of R9.5 million. Deloitte’s report looked at over 250 JSE listed companies in 2018.

Chief financial officer, Mike Smith received a R12.27 million payday, including a R2.3 million basic salary, a R7 million bonus, and R2.8 million long term incentive.

Piet Mouton, son of Jannie Mouton and current CEO of the PSG Group, also received R7.95 million in his role as non-executive director.

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R62 million payday for South African wealth management boss