Sears interim CEO earns $1.9 million in 2008
The interim chief executive at Sears Holdings Corp. saw his 2008 compensation sink by more than half in 2008, as the ailing retailer's profit plunged 94 percent, according to a regulatory filing Tuesday.
W. Bruce Johnson's compensation was valued at $1.9 million during the company's fiscal year that ended Jan. 31.
Johnson took the helm of the Hoffman Estates-based retailer, which owns Kmart and Sears stores, last February.
The 57-year-old earned a base salary of nearly $897,000 in 2008. That's about 20 percent more than he earned in 2007, when he spent the fiscal year as the company's executive vice president of supply chain and operations, at a salary of $745,224.
Johnson also received about $9,500 in other compensation, nearly all of which was a matching contribution to the company's 401(K) retirement plan.
Much of the decrease in Johnson's compensation resulted from a hefty decline in his restricted stock and options awards.
In 2008, he received stock and options valued at about $1 million on the date they were granted. That's 71 percent less than the awards valued at $3.5 million that he received in 2007.
But the 2008 options are of little value unless Sears stock rises substantially in price. That's because the price Johnson would have to pay to exercise the options -- $108.31 per share -- is nearly triple the stock's current price. It closed Monday at $38.18.
The Associated Press formula for calculating executive compensation 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 SEC, which reflect the size of the accounting charge taken for the executive's compensation in the previous fiscal year.
For the full year, Sears earned $53 million, or 42 cents per share. That's down more than 90 percent from the previous year's profit of $826 million, or $5.70 per share.
Revenue slipped 8 percent to $46.77 billion. Companywide same-store sales dropped 8 percent, while Sears domestic same-store sales fell 9.5 percent and Kmart same-store sales declined 6.1 percent.
Same-store sales, an important retail industry metric, compare sales only in stores open at least a year.
The company's shares opened last year at $103, but tumbled along with most of the stock market to end the calendar year at $38.87, down 62 percent. Shares have held mostly steady in the first months of 2009, trading Tuesday up 82 cents, or 2 percent, to $39.