Lovisa Holdings Ltd CEO Victor Herrero clinched one of the highest remuneration packages among ASX executives last year, earning $29 million over the 12 month period.
Herrero’s remuneration package not only outpaces the salaries of Woolworths and Coles executives but also surpasses the controversial $24 million severance package for former Qantas CEO Alan Joyce.
Lovisa’s annual report, including its remuneration report, were released late on Thursday, revealing that Herrero’s A$29.09 million package — largely comprising long-term incentives — approached half of Lovisa's A$68.2 million full-year profit.
The package comprises A$1.9 million in salary, A$2.05 million in performance-based payments, and a substantial A$24.975 million in options and rights. These figures mark an increase from his 2022 compensation of A$20.9 million.
Comparatively, Rob Scott, the CEO of Wesfarmers (ASX:WES), a conglomerate nearly 30 times Lovisa's size, took home A$8.175 million in 2023. In fact, Herrero's remuneration even surpassed the combined A$23.7 million earned by Wesfarmers' four highest-paid executives.
A former executive at Zara owner Inditex (BME:ITX), Herrero assumed his role at Lovisa in November 2021. The jewellery retailer has a A$2.22 billion market capitalisation and annual revenue just shy of A$600 million. In contrast, Perth-based Wesfarmers reported revenues for the 2023 fiscal year of A$43.55 billion.
Despite Herrero's high remuneration, Lovisa shares fell 13.67% over the year. They closed 1.7% lower at A$20.58 on Thursday.
Perhaps foreseeing the surprise around the size of his compensation, Herrero last month indicated that the company continues to achieve strong profit growth and global expansion.
The substantial payment to Herrero raises questions about executive compensation, particularly as it constitutes a significant portion of the company’s annual profit and comes amid falling share prices.