Anticipating rough sales numbers earlier this year, Burberry laid out plans to simplify its business to compensate for losses at retail. Not announced in these changes? A rather considerable decrease in payout for Chief Creative and Executive Officer Christopher Bailey, as announced in Burberry's annual report.
Bailey will see his pay drop from £7.5m in the financial year ending March 2015 to £1.9m in the financial year ending March 2016 — a 75 percent drop year-over-year. Bailey also "requested that the vesting date of the first tranche of his 2013 exceptional share award be deferred for a further 12 months," pushing back receiving this bonus until July 2017. Fellow execs also saw massive drops in their salaries, with Chief Financial Officer Carol Fairweather dropping from £1.6 million to £683,000, and Chief Operating Officer John Smith dropping from £1.5 million to £813,000. These decreases are due, in part, to directors not being rewarded annual bonuses or "previous awards granted." (Bailey's base salary is £1.1 million.)
The company reassures shareholders that "[the] Burberry brand has never been stronger," but does once again caution that the retail landscape has become very difficult for luxury brands. At least if the company faces potential layoffs — as was implied last May during a webcast earnings report — people at the top are taking cuts as well.