Billionaire Johann Rupert scores R54 million payday

South African billionaire Johann Rupert took home a R54 million payday in 2020, for his role as chairman at Swiss luxury goods company, Richemont.

Richemont – which Rupert founded and currently chairs – has published its integrated report for 2020, showing its pay structure for senior executives for the year.

Rupert’s total pay amounted to CHF 3.09 million, up from CHF 2.7 million in 2019. At current rates, that converts to roughly R54 million. His payout from Richemont comprises a basic salary of CHF 2.7 million, and social security costs of CHF 393,000.

According to the latest Forbes Billionaire Ranking, Rupert is currently the second wealthiest man in South Africa, with a total net worth of $4.6 billion (R80 billion).

Rupert’s wealth is tied up in various investments, including a significant shareholding in Richemont. He is the sole general managing partner in Compagnie Financière Rupert, which holds 10% of Richemont’s shares, and has 51% of the group’s voting rights.

He is also holds a stake in investment group Remgro, through a family trust.

Executive pay

Richemont’s executive pay totalled CHF 49.3 million for the year, with French luxury goods group Van Cleef & Arpels CEO Nicholas Bos taking home CHF 9.2 million.

Group chief executive Jérôme Lambert took home CHF 8.0 million.

During the year to 31 March 2020, Bos, Lambert and executive director Emmanuel Perrin aslo received a cash payout as a result of a long-term incentive award made in 2016 as compensation for their positions as brand executives at that time.

Financial performance

Richemont reported a weaker financial performance over the period, with the group noting that trading and operations were strongly affected by Covid-19 pandemic in the fourth quarter.

Fourth quarter sales declined by 18% at actual exchange rates, with sales in Asia Pacific down by 36%, including Hong Kong SAR, China, down by 67%; sales in Europe decreased by 9% while
they rose by 9% in the Americas.

Overall group sales for the year increased by 2% at actual exchange rates to €14.24 billion and were stable at constant exchange rates, it said, but operating profit for the year decreased by 22% to €1.52 billion.

Profit for the year decreased to €931 million.

The group said that growth was driven by Online Distributors and Jewellery Maisons, and there were good performances in the Americas, Europe and Japan – which offset a decline in Asia Pacific.

“There are signs of improvement in terms of our business,” Rupert said. “Since our 462 boutiques in China have re-opened after the virus, we have seen strong demand. Equally, the steps we have taken in recent years to change the way we operate see the Maisons well positioned.

“Our approach has been to shift from a fixed cost basis of operating to a more flexible model. We see online marketing as a key element of that.”

However, despite this recovery, Rupert said that uncertainty around the virus will persist.

“No-one can say when we will see economic activity normalise. Other economies will probably find it difficult to emulate China. We may be looking at 12, 24 or 36 months of grave economic consequences,” he said.

“Perhaps that is too pessimistic but who knows?”

Ruper, through the Rupert family and Remgro Limited pledged R1 billion towards a fund it set up – the Sukuma Relief Programme – to provide financial aid to formal SMEs affected by the Covid-19 pandemic in South Africa.