Terry Smith, the UK fund management star, saw his pay cut for the second year in a row after his company's profit dipped and his flagship fund underperformed the benchmark for a third successive year.
Profit made by his Fundsmith investment house for the 12 months to March 2024 slipped to £46.4 million from £49.9 million last time, according to accounts filed with Companies House.
The share of profit paid to its largest shareholder, understood to be Smith, fell to £27.8 million from £31.2 million and around £36 million in 2022.
However, Fundsmith Investment Services, Smith's Mauritius-based subsidiary, received a transfer of £186.1 million for the past year, up from £185.7 million last time.
Smith, who set up Fundsmith in 2010, could have made a further £113 million on top of his £46.4 million, according to trade publication Citywire, based on the 61% entitlement he could receive if the subsidiary operates under a similar ownership structure to Fundsmith.
Even without that top-up, Smith's remuneration is well above highest paid FTSE 100 CEOs, which in 2023 were AstraZeneca's Pascal Soriot, who received a pay package of £16.85 million last year; Rolls-Royce boss Tufan Erginbilgic, who took home £13.61 million; and BAE Systems and RELX bosses Charles Woodburn and Erik Engstrom who both were rewarded with packages around £13.5 million.
The flagship Fundsmith Equity fund delivered a 12.4% return last year, underperforming the MSCI World 16.8% return, but still outperforming the benchmark since launch with close to a 600% return versus 381% in sterling terms.
Famously, the portfolio has not contained Nvidia, so has missed out on a lot of the gains in the past two years, but has owned Apple, Meta and Microsoft.