Gap Inc.’s former chief executive officer Glenn Murphy saw his total pay drop 14.2 percent, to $16.1 million, and its cash component fall by more than half, to $2 million, in his final year with the company.
This story first appeared in the April 8, 2015 issue of WWD. Subscribe Today.
Murphy, now the former chairman and ceo of the San Francisco-based specialty store behemoth, collected $1.5 million in salary, the same as in every year since 2010, while his cash bonus, or non-equity incentive plan compensation, fell nearly 80 percent to $538,000 from $2.7 million in 2013, as Gap, weighed down by weakness at its namesake brand, failed to reach target sales and earnings levels for the year.
Murphy stepped down as chairman and ceo of Gap in October and was succeeded by Art Peck as ceo and Robert Fisher on a non-executive basis as chairman in February.
Murphy’s stock awards were down 3 percent to $13.8 million from $14.2 million in 2013. Although the Securities and Exchange Commission requires that these awards be reported at fair market value on their grant date, executives might realize lesser amounts because of fluctuation in stock prices, vesting schedules and other considerations.
“While we achieved a [total shareholder return] of 10 percent in fiscal 2014 and successfully grew revenue and earnings per share, led by strong performance at Old Navy and very disciplined expense management,” wrote the compensation and management development committee in the proxy report, “our incentive compensation targets for both revenue and earnings were set at a level that required meaningful improvement from fiscal 2013 and we fell short of these goals except at Old Navy.”
Gap’s sales last year rose 1.8 percent, to $16.44 billion, while EPS was up 4.7 percent to $2.87. Corporate comparable sales were flat, with the Gap brand down 5 percent, Old Navy up 5 percent and Banana Republic flat.
Old Navy’s net sales rose 5.8 percent to $6.62 billion from $6.26 billion in 2013 while Gap’s declined 2.9 percent to $6.17 billion from $6.35 billion and Banana Republic’s rose 1.9 percent to $2.92 billion from $2.87 billion.