Moir’s big pay day suggests he is staying put at Woolworths
Store and supply-chain staff paid bonuses for first time in three years
Woolworths group CEO Ian Moir, who has come under attack for championing the disastrous 2014 acquisition of Australian-based David Jones, has been allocated shares worth R28.5m, putting paid to speculation that he’s on his way out.
That was in addition to the R23m remuneration he received in 2019. As he will be able to exercise the right to trade on the shares only in three years’ time, the award, contained in the company’s latest annual report, means it is unlikely the board is planning to force him to retire before his contract expires in 2021.
In 2018 Moir was also awarded R28.5m of shares in addition to his R30m remuneration.
Woolworths, the second-biggest retailer by market capitalisation on the JSE’s general retailers’ index, has operations in SA, Australia and New Zealand. In the year to June the group had to take its second write-off on the Australian department store chain, bringing the total write-off to date to R11bn.
For the 12 months to end-June 2019, group sales rose 3.9% to R78.2bn but profit after tax fell 3.7% to R4.6bn, largely as a result of the weak performance in the group’s non-SA operations.
Moir was not the only executive to receive shares in terms of the “once-off” restricted share plan. In total, R243m worth of shares were allocated in 2019, with Woolworths SA CEO Zyda Rylands, group COO Sam Ngumeni and chief finance director Reeza Isaacs receiving a combined R56.1m. Other key executives were allocated the remaining R158m.
In its just-released remuneration report, the board, which describes the restricted share awards as “once-off”, says the executive directors are regarded as being key to ensuring the group delivers sustainable returns for shareholders.
“They hold pivotal roles in the group structure and the [remuneration] committee considered it important to retain these key individuals for continuity and delivery of the long-term strategy,” said Woolworths.
The awards are conditional on the achievement of acceptable individual performances over a five-year period for executives other than Moir, who faces a three-year performance period.
A spokesperson for Woolworths said the single-figure remuneration disclosed in the report does not include the restricted shares because there are performance conditions associated with those allocations.
“Once the shares have vested and the performance conditions met, then the allocations will be incorporated into the single-figure remuneration,” said the spokesperson.
Rylands, who oversaw a comparatively strong performance at Woolworths SA, was the only executive to be awarded a short-term bonus in 2019. Her R2.1m short-term bonus helped bump up her total remuneration — excluding the once-off restricted shares — to R12m.
For the first time in three years store and supply-chain employees in Woolworths SA also received bonuses.