The pay package of Marks & Spencer’s chief executive jumped to more than £7m just weeks before the cyber-attack that rocked the retailer.
Stuart Machin received £7.1m for last financial year, up nearly 40% on the £5.1m he took home a year earlier, according to its annual report. He received the bump thanks to a sharp rise in performance-linked bonuses.
The pay deal relates to the year ending in March, just weeks before it emerged that a cyber-attack had paralysed the company’s online operations.
On top of £894,000 of fixed pay and pensions benefit for the year, Machin received £1.6m in bonus linked to the retailer’s performance. He also received £4.6m in long-term performance-based bonuses, which he cannot access for at least two more years.
Machin, who became chief executive of M&S in 2022, will also receive a 2% pay rise from July, taking his annual salary to £865,700, as he leads the retailer through the aftermath of the cyber-attack, which began over the Easter weekend.
M&S said on Monday that it had “agreed to delay” setting the performance targets for pay in the current financial year in light of the hack.
The cyber-attack has forced the company to stop orders through its website. Deliveries of food and fashion to its stores were also disrupted, as were some deliveries to its online food partner, Ocado.
M&S admitted that some personal details relating to thousands of customers, such as names, addresses, dates of birth and order histories, were taken.
The cyber-attack, which has been linked to the hacking collective Scattered Spider, emerged days before reports of similar hacks against the Co-op and Harrods. Machin has told reporters that hackers gained access to Marks & Spencer’s IT systems through a third party after “human error”.
While the attack occurred under Machin’s watch, he has been praised in some quarters for his handling of the crisis, with regular communications to customers and investors.
M&S said in May it expected an estimated £300m hit to profits this year because of the attack. The company is still unable to process online orders, although it is understood it hopes to partly restore this within two to three weeks.
The M&S chair, Archie Norman, said in the annual report that the impact of the cyber-attack was likely to “endure for some weeks, or even months”.
He added: “I am confident that in a year’s time the cyber incident will prove to have been a bump in the road along the path to growth, even if it does not feel like that today.
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“However, coming on top of a very strong trading year it has stretched the sinews of the management team and we have seen an extraordinary response from our colleagues in the support centre, in our logistics centres and particularly in our stores.”
The attack interrupted a strong period of trading for M&S. Overall sales were up by 6% to £13.9bn in the year to 30 March. Food sales rose by almost 9% to £9bn, while fashion and homeware increased by 3.5% to £4.2bn.
Shares in M&S have risen by more than a fifth over the last year, and have made a partial recovery after falling in the weeks after the hack emerged.
A spokesperson for the retailer said chief executive pay was decided by its board and related to performance targets.
“Almost 90% of Stuart’s pay is linked to performance of the business and the share price – therefore his total pay for FY25 p[financial year 2024-25] reflects the strong performance and growth of M&S under his leadership over the last three years,” the said.
“Over 75% of Stuart’s pay is made up of long-term and deferred share awards, subject to waiting periods and tied to future share price performance.”
