KUALA LUMPUR (July 19): Trading in Sapura Energy Bhd surged, making it the fourth most active counter on Bursa Malaysia, with 35.71 million shares exchanging hands as at 11am, versus its 200-day average of 10.76 million.

The stock fell one sen or 1.67% lower at 59 sen, giving it a market capitalisation of RM3.6 billion. Sapura Energy's share price plunged to a record low of 41 sen at mid-March this year.

Yesterday, it was reported that institutional investors such as the Employees Provident Fund have voiced their unhappiness over the remuneration received by loss-making Sapura Energy's president and group chief executive officer (CEO) Tan Sri Shahril Shamsuddin, which totalled RM71.92 million for the financial year ended Jan 31, 2018 (FY18), according to the Minority Shareholder Watchdog Group.

The amount is equivalent to 1.22% of the group's FY18 revenue of RM5.89 billion.

According to its Annual Report 2018, Shahril was paid a salary and related emoluments of RM7.24 million and he was also awarded with a RM55 million bonus, which was based on prior year's group performance and achievements, along with RM9.34 million in defined contribution plan and RM348,000 in various benefits-in-kind.

Meanwhile, The Edge Financial Daily today reported that Shahril confirmed the existence of the share covenant that he has with financial institutions, when the oil and gas group refinanced its whopping RM14 billion in borrowings.

Shahril explained that if he sells his shares below 10%, the loan will default, and if he steps down from being the CEO, the loan will also be in default.

Shahril is the single largest shareholder of Sapura Energy holding a 15.9% stake. The share covenant, however, was not stated in the annual reports.

He reiterated that he did not ask for the high compensation, adding that his salary is determined by the board.

According to Shahril the share covenant started back in FY14. "With the loan refinancing, we managed to get better rates with an average of about 5%, compared with others in the industry that are paying 6% to 7%," he said.

The group's annual reports indicated that Shahril's salary was above the RM80 million band between FY14 and FY17. His remuneration package, however, shrank slightly to RM71.92 million in FY18 when the group dipped into the red with a net loss of RM2.5 billion, dragged down by a massive RM2.13 billion impairment provision.