The chief executive of Next has taken a 55 per cent cut to his pay package after the high street chain posted its first fall in annual profits in eight years.

The fashion retailer‘s annual report, released yesterday, indicated that Lord Simon Wolfson‘s total remuneration for 2016/17 was £1.84 million, compared to £4.29 million the year prior.

Next‘s wider management team had their salaries cut by 35-40 per cent, according to the report.

The chain’s remuneration committee added that no executives would be receiving an annual bonus for the last financial year either, and long-term share awards have been also slashed.

The retailer‘s fiscal year ending January saw underlying pre-tax profits drop by 3.8 per cent to £790.2 million, marking the first decline since 2008 in the depth of the recession.

A worse-than-expected Christmas season performance, which helped push Next to a 5.5 per cent drop in annual profits, also prompted it to warn over sales and profits as it braces for “tougher times” in 2017 – a warning that saw its share price plummet by 14 per cent.

READ MORE: Next sees first profit drop since 2008

Next has also raised its prices by an average four per cent since the Brexit referendum last June, and also blamed “inflationary pressures” from things like the National Living Wage, the Apprenticeship Levy, and the business rates review for its poor performance last year.

The fashion retail bellwether said it saw no end in sight to the tough trading environment, and its share price remains more than 20 per cent down on a year ago.

“As outlined in our strategic report it has been a challenging year for Next and the remuneration outcomes for the directors have reflected this,” Next remuneration committee chair Caroline Goodall said.

“Total annual remuneration earned by our executive directors for the financial year 2016/17 was significantly less than that earned for the financial year 2015/16.

“In the view of the remuneration committee, this is appropriate and aligns the remuneration received by management with the experience of shareholders.”

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