Mega-payout for M&S boss Bolland

Marc Bolland, the chief executive of Marks & Spencer, will pick up a bumper package of £2.5 million this year, despite presiding over a fall in annual profits.

The total pay awarded to the Dutchman, who took the helm at the High Street stalwart in May 2010, is likely to sharply contrast with a fall in the annual bonus for the 78,000 staff at M&S. The payout to Bolland could also cause consternation at the retailer’s annual meeting next month, given the recent fall in its annual profits and backtracking on long-term sales targets.

Pre-tax profits fell by 1% to £705.9 million for the year to March 31, following a below-par performance at the chain’s womenswear division.

Bolland was paid a total of £2.5 million last year, including a salary of £975,000, a cash bonus of £332,000 and the same amount in deferred shares that can be exercised in 2015.

This payout also includes shares worth £500,000 that vested in December but he has not yet cashed in.

However, the M&S chief’s total payout is actually down on the £4.96 million he received in the previous year, which was bumped up by the compensation Bolland was awarded for leaving his previous employer, Morrisons.

Group sales at M&S, which has 730 stores in Britain and 387 overseas, rose by 2% to £9.9 billion last year.

But the 128-year old retailer was forced to downgrade its target to grow sales by an additional £2.5 billion by 2014, which it blamed on the dire UK economy.