King has done a fantastic job at Sainsbury's in the past 18 months and, halfway through the three-year recovery plan, with the supermarket ahead of its extra £2.5bn sales target, it looks like he will be a very rich man indeed by May 2008.
But as analysts pointed out following last week's results, while sales are bounding ahead nicely (now at £17.7bn), operating profit margins are at 2.43%, below the 2.7% of Morrisons, let alone the 4.9% recorded at Tesco. King has commendably grown the share price, too, from around 280p to 440p in this time. But he still has some way to go to match the performance of M&S, whose shares have more than doubled in the past 18 months, up from about 350p to 720p. Its profits were up 22%, with margins increasing to 11.4% and sales up 7.6%.
Of course, financial numbers can tell you only so much about a company's recovery. But where King has started by growing the top line, it's interesting that Rose started by hacking back costs, reducing stocks and commitment by £1.3bn (the 'focus' element in his strategy), before he moved on to sales with the 'drive' and 'broaden' elements. The challenge for King now is to convert those extra sales into meaningful profit. And that must mean addressing the efficiency of the company, where there is still room for improvement in logistics, store layout, shelving and space utilisation. And is it me or does the HQ need pruning?