Coronavirus: Primark execs take pay cuts as Joules raises £15m

Primark boss Paul Marchant, ABF chief executive George Weston and the group’s finance boss John Bason have all asked for their base pay to be temporarily reduced by 50% during the pandemic.

All non-executive directors on the ABF board, including chair Michael McLintock, have had their fees cut by 25%.

ABF said: “The board, including the executive management team, believes that these steps are appropriate given its expectation that full-year earnings will now be much lower than envisaged at the start of the financial year.

“The board is acutely aware that many Primark employees will see their livelihoods affected by Covid-19.”

It added that measures to reduce operating costs across Primark “continue to be developed and implemented”.

ABF warned of the impact of coronavirus in March, scrapping full-year guidance. It said it was “managing the business appropriately”, but did not expect to “significantly mitigate” the impact of sales lost through closed stores.

Primark does not operate an online business and its stores have not been open for business since March 21.

The clothing giant, which also operates in continental Europe and the US, held back its quarterly rent payments, which had been due on March 25, owing to the “unprecedented” circumstances created by coronavirus.

Bason told Retail Week at the time: “We are in extraordinary times. I want to underline how quickly things have changed. When would I ever have thought that all Primark’s sales would be lost? It’s the scale – we’ll suffer big losses and we’re saying to landlords, ‘Give us some help here’.”

Joules’ equity raise

Meanwhile, Primark’s fashion rival Joules has raised £15m through a share placing to help it ride the storm sparked by the pandemic.

Almost 19 million new shares in the business were snapped up by investors at 80p per share. Joules’ share price opened this morning at 86p.

The retailer said the cash would give it “sufficient liquidity headroom in a Covid-19-related downside scenario”.

Joules insisted that would allow it to “emerge relatively stronger from this unprecedented situation”.

Boss Nick Jones said: “This placing will help Joules to deliver its long-term growth plans, as well as supporting the business to successfully navigate through the current unprecedented trading environment.

“I would like to take this opportunity to thank all our colleagues, customers and the wider Joules community of suppliers and partners for their continuing support throughout this challenging period for us all.

“We are delighted with the levels of support from our shareholders, which reflect broad recognition of the strength of the Joules brand and our business model, as well as our exciting long-term prospects.”