Marks & Spencer boss Marc Bolland braced for shareholders fury over 'excessive' pay
Marks & Spencer boss Marc Bolland will come under pressure tomorrow from frustrated shareholders over “excessive” pay and disappointing sales figures.
Despite efforts to pull in customers with celebrity-laden adverts, featuring the likes of actresses Joanna Lumley and Rosie Huntington-Whiteley and popstar Gary Barlow, the group is expected to reveal its worst quarterly trading performance in three years.
But still Dutchman Mr Bolland saw his basic annual package rise by 4% last year to £1.7 million and could reportedly take home as much as £6 million including bonuses and long-term incentives.
Advisory group Pensions Investment Research Consultants (Pirc) has recommended shareholders abstain on voting on the group's remuneration report at its annual meeting in London tomorrow.
The meeting comes as M&S's market value slipped behind its smaller rival Next for the first time as City investors worry that the retailer is losing female customers to rivals.
Shares in M&S, which has more than 700 stores, have fallen about 15% since March giving it a market cap - the total value of all shares - of £5.19 billion.
Next, which has fewer shops, no food business and fewer customers, has a market value of £5.24 billion, although its chief executive Lord Wolfson has played down the moment.
M&S has borne the brunt of falling high street spending in recent months as it competes with frenzied levels of promotions.
Pirc said awards made last year were "excessive" at twice the level of salaries, despite the retailer reporting its first drop in profits for three years.
It added the pay structure still promoted "future excessive pay-outs" and hit out at a £4 million 'golden hello' for Laura Wade-Gery, executive director for multichannel e-commerce, after she joined from Tesco.
The wettest April to June period on record has also added to its woes, with the City forecasting a 3% drop in UK like-for-like sales excluding VAT.
General merchandise - or non-food - sales are expected to be down 6.7%, its worst performance since the quarter to the end of December 2008.
Nick Bubb, independent retail analyst, said: "The poor weather clearly hasn't helped any fashion retailer in recent months, but M&S's problems in womenswear go far beyond the weather, as they are clearly losing market share.
"The confusing array of sub-brands and the uninspiring merchandising and store ambience are bigger issues and although they are issues recognised by management the poor first-quarter sales imply that M&S's response has simply been too slow."
However, sales of food are expected to rise 0.8% after being boosted by the Diamond Jubilee celebrations.
Rod Whitehead, an analyst at Deutsche Bank, said: "We worry that the weakness in the top line is not just the weather. Some commentators are suggesting that M&S's womenswear range has been off-trend this summer."
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