Jewellery retailer Lovisa saw its strong sales momentum in FY19, with a 15.3 per cent increase in revenue, continue into the first 17 weeks of FY20, with comparable store sales up 2.3 per cent for the period.
But over 32 per cent of shareholders at the retailer’s annual general meeting on Tuesday voted against the group’s revised remuneration report – more than the 25 per cent necessary to deliver a first strike.
Lovisa director James King spoke on the strike at the meeting, in particular the board’s decision to increase general manager Shane Fallscheer’s fixed pay to $1.5 million.
“Running a global business is an extremely demanding and complex task, requiring significant sacrifice due to travel commitments and associated time away from family, and this is particularly true with Shane,” King said.
“It is also important to remember that as a successful global retailer, this company needs to be remunerating executives with reference to appropriate global benchmarks, not just other Australian listed companies.”
Fallscheer’s fixed pay previously sat at $1.3 million a year, according to SimplyWallSt.
If next year’s remuneration report is also voted down, a second strike will mean shareholders could vote for the retailer’s board to stand for re-election.
Lovisa keeps eye on expansion
During the first 17 week of FY20, the business continued its focus on expanding its store network. It has launched 31 new stores since the end of FY19, bringing its total store count to 421.
“We will continue to invest in our support structures, in particular in the USA, to support store network growth and the larger business,” Fallscheer said.
“We are now trading from 33 stores in the US across 5 states having recently opened in Illinois and Minnesota.”
According to Fallscheer, the retailer’s core focus moving forward is to invest in roles that are required to further its growth ambitions, while continuing to source suitable store locations.
This story first appeared on sister site, Inside Retail Australia.