Jill McDonald takes over from Matt Davies, the highly rated but relatively short-lived Halfords chief executive, who has been snapped up by Tesco, the food retailer itself in continuing dynamism mode under the new leadership of Dave Lewis, formerly of Unilever.
Davies had only taken over in October 2012 following a profits warning from his Halfords predecessor, David Wild, and is widely credited with having pulled the retailer out of the dive, restoring sales and profits as part of a three-year programme to upgrade stores. The company’s share price rose two-thirds during his tenure.
His are therefore relatively big boots to fill, but McDonald herself comes with a strong track record. She certainly will not be overawed in taking over the Halfords brand when she has already overseen the UK arm of the American restaurant chain.
Both are large, established, service-led businesses with strong resilience to business cycles, but which have come through periods when the formats for a time looked a little tired. McDonald will benefit from the improvements Davies had implemented, but she will undoubtedly have her own plans to take Halfords forward.
Not least in the somewhat lacklustre part of the business dealing with sat nav and car audio products, which has continued to lose its way compared to strong growth in bikes and car maintenance.
The size of the McDonald’s “golden hello” at the company shows how serious the board was in making sure Davies’s departure was not seen as damagingly anti-climactic for a retailer that was rediscovering its touch.
She will get £500,000 basic pay, plus a maximum annual bonus of 150 per cent of her salary, while also being able to participate in a long-term investment plan worth another 150 per cent of her salary.
Finally, she is compensated for the loss of long-term share incentives at McDonald’s by getting Halfords stock worth £495,000 over three years. Eye-watering, but it will be money well spent if she builds on the recovery momentum.
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