Board members at fashion retailer Supergroup will see their salaries frozen this financial year despite a highly impressive first 12 months of trading as a public company, according to the business’s annual report which was published yesterday.
Underlying profit before tax at the group, which owns the Superdry and Cult brands, jumped £23.7 million to £50.2 million between 2010 and 2011, but CEO Julian Dunkerton and his fellow executive directors will maintain the same pay level in the year ahead.
For the last 12 months Dunkerton took home a salary of £400,000 and benefits, including medical insurance and a car allowance, of £18,745, while CEO of Wholesale & International Theo Karpathios and Brand & Design Director James Holder each pocketed basic pay of £300,000.
Finance Director Chas Howes was the next highest earner on the board with a salary of £225,000, which was also the pay level of Chief Operating Officer Diane Savory who quit her role at the company in May this year.
Savory received a pay-off of £112,500, which she is currently receiving in equal monthly instalments until the end of 2011 and equates to around six months of base salary.
Explaining Supergroup’s pay policy, the annual report said: “As a result of the executive directors’ significant shareholdings in the company and commitments to retain shares, the remuneration committee believes that individuals are sufficiently incentivised to mitigate the need to offer annual or long-term incentive arrangements at this point.
“The remuneration committee will keep this policy under continuous review.”
It did reveal however, that changes will be made to the pay structure for those senior executives directly below board level, in order to recruit, retain and incentivise employees who do not have a significant shareholding in the business.
Annual bonus and long-term incentive arrangements for certain senior execs have therefore been introduced, while private medical cover and life insurance have been issued to others.
Earlier this year Supergroup admitted to having supply chain problems, resulting in the full range of summer stock being slow to appear in stores across the UK and preventing the company from capitalising fully on the unseasonably warm spring weather experienced across the country.
In his introduction to the annual report, Supergroup Chairman Peter Bamford acknowledged there were a number of areas where this growing business – and one of the retail success stories of the last 18 months – can still improve.
“We have reviewed all aspects of our infrastructure over the last year and agreed a number of investments and developments,” he said.
“In order to support our growth and run our business efficiently, improvements are required to our IT systems and to our merchandising, sourcing and supply chain processes.”