[imagesource:freerangestock]

Well, this might just tell you all you need to know about where South African shoppers have preferred to spend their dwindling earnings over the last few years.

The CEO of Shoprite, Pieter Engelbrecht, received a total compensation package of R83 million in 2024 – about R20 million more than the year before.

On the other side of the country club, Roy Bagattini from Woolworths had to take half of the R122.5 million he received in the previous year, only taking home a total of R65 million for 2024.

Including previous share awards and other short-term incentive objectives, Engelbrecht’s total compensation in 2024 was R68.523 million – Compared to the R64.66 million he earned the year before, this was a 6.6% increase, or R3.857 million.

This comes on the back of a reported 18% increase in annual sales for Shoprite, while its headline earnings grew almost 10% and its dividend was hiked by 10.5%.

Woolworths, on the other hand, had to slash its final dividend by almost a quarter as sales in its local fashion business and its Australian and New Zealand operations came under pressure.

It’s unlikely that the Woolies CEO will be applying for debt relief anytime soon, but it does point to Shoprite’s growing market share in the vacuum that Pick n Pay seems to be leaving.

Emphasising the stratospheric nature of the CEO’s salaries, the new Companies Amendment Act, which was recently signed into law, compels companies to disclose the earnings gap between their highest- and lowest-paid workers.

Neither Shoprite nor Woolies provided a minimum wage figure for 2024, but Woolworths said its lowest-paid worker earned R93 600 last year. It would take that employee 1,311 years to earn what Bagattini did last year – if that helps to soothe his burn a little bit.

News24 reports that FNB portfolio manager Wayne McCurrie said Bagattini’s pay cut was understandable given that Woolies had not been as successful this year. While its food business has performed well, it has struggled in Australia and New Zealand while at the same time, the retailer is still waiting for a turnaround in the fashion, beauty and home segment.

McCurrie said Engelbrecht’s pay did not seem outrageous, considering how successful he had been in running the company. Given how well Engelbrecht had managed the business, McCurrie said his compensation did not appear excessive.

“Of course, to the proverbial man in the street, it may seem outrageous, but that is what you’ve got to pay to attract the talent. At the same time, though, they have to deliver.”

Fair enough. Engelbrecht seems to be delivering like a new Checkers Sixty60 driver on an R100 tip, so Shoprite is getting value for their money.

[source:news24]