Time Warner CEO Jeffrey Bewkes Awarded $21.5M 2008 Pay Package
LOS ANGELES — Jeffrey Bewkes, the chief executive officer of media giant Time Warner Inc., was awarded compensation in 2008 valued at about $21.5 million according to an Associated Press tally of data filed with regulators.
That's up 11 percent from a year ago, as the New York-based company cut costs and moved to shed assets such as its cable unit and AOL. But nearly a third of his compensation came in the form of stock options that are currently "underwater" and therefore of little value.
Bewkes, 56, received a salary of $1.75 million, up 40 percent from the $1.25 million he received in the previous year, according to a filing with the Securities and Exchange Commission on Wednesday.
He received a performance-related cash bonus of $7.6 million, up from $7 million a year earlier. Other compensation, including personal use of car, driver and company plane, insurance premiums and a savings plan match, hit $103,517, up from $87,593 a year ago.
Stock options and performance stock units were valued at $12 million on the days they were granted, up from $11 million a year ago. But the option to purchase some 673,000 shares at $33.27 each, granted in March, currently has little value because Time Warner's stock closed at $21.92 on Wednesday. The options vest through 2018, so they could become valuable if the stock price rises above the exercise price.
Bewkes is on target to receive performance stock units which vest in 2013, if he meets certain goals, worth an estimated $5.3 million when they were granted on Jan. 1, 2008.
The Associated Press formula is designed to isolate the value the company's board placed on the executive's total compensation package during the last fiscal year. It includes salary, bonus, performance-related bonuses, perks, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year.
The calculations don't include changes in the present value of pension benefits, and they sometimes differ from the totals companies list in the summary compensation table of proxy statements filed with the Securities and Exchange Commission, which reflect the size of the accounting charge taken for the executive's compensation in the previous fiscal year.
Bewkes took over as CEO from Richard Parsons in January of 2008 and he positioned the company to spin off Time Warner Cable Inc., which it did last month, resulting in parent Time Warner receiving $9.25 billion. Both companies also put into effect a 1-for-3 reverse stock split.
Parsons served as chairman of Time Warner throughout 2008, turning over the post to Bewkes in early January 2009, and now serves as chairman of troubled New York-based bank Citigroup Inc. Parsons received a 2008 pay package from Time Warner of $8.6 million, including sums associated with his retirement, restricted stock units worth $1.6 million on the day they were granted and $1.4 million worth of stock options that are currently "underwater."
On Monday, Time Warner said it is offering bondholders $61.5 million if they'll let its AOL unit sell assets, which analysts said suggests a spin-off is increasingly likely. Time Warner bought the Internet business, which has struggled against rivals Yahoo Inc. and Google Inc., in 2001 for $147 billion.
Time Warner also owns the Warner Bros. movie studio, cable networks CNN, HBO, TNT and TBS and the Time Inc. family of magazines.
The company enacted cost cuts at the studio, shutting down some smaller labels like Picturehouse and Warner Independent, and laid off staff at its publishing divisions last year.
For the full fiscal year, Time Warner reported a loss of $13.4 billion, or $3.74 per share, compared with profit of $4.39 billion, or $1.17 per share, in the previous year, mainly because of a $24.2 billion write-down for its cable, publishing and AOL assets. Annual revenue grew 1 percent to $46.98 billion from $46.48 billion.
Shares fell 39 percent to $10.06 on Dec. 31, from $16.51 the previous year, before the reverse split.
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RYAN NAKASHIMA | April 8, 2009 07:44 PM EST |