(The Associated Press circulated the following story by David Twiddy on March 30, 2009.)
KANSAS CITY, Mo. — The chairman and chief executive of Kansas City Southern received compensation valued at $1.4 million in 2008, or 73 percent less than the year before, according to an Associated Press calculation of figures disclosed in a regulatory filing Monday.
Michael Haverty, 64, was paid $759,533 in salary, $473,189 in nonstock incentive bonuses and $51,662 in other compensation, which included a $30,000 match of charitable contributions and $8,000 in financial planning reimbursement payments.
Haverty also received stock and options that the Kansas City-based company valued at $118,340 at the time they were granted.
His total 2007 compensation was valued at $5.2 million, including $727,794 in salary, $679,302 in nonstock incentive bonuses, $50,494 in other payments and $3.7 million in stock and options.
The Associated Press executive compensation 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.
Haverty, who has served as CEO since 2000 and chairman since 2001, also became vested in 47,165 shares of company stock valued by the company at $1.5 million and exercised options worth $16.7 million during the fiscal year. Those figures were not included in the compensation calculation because they are based on personal finance decisions.
For the year, the company said it earned $168.7 million, or $1.86 per share, compared with $134 million, or $1.57 per share, during 2007. Revenue rose 6.3 percent to $1.85 billion from $1.74 billion.
The struggling economy has hurt railroad operators as factories and customers are moving less freight. Kansas City Southern announced last week that U.S. carloads were down 5.9 percent in the first quarter and it planned to raise up to $275 million through debt and equity sales to pay off existing debt and maintain liquidity through next year.
The company said in its proxy that it will hold its annual shareholders meeting on May 7 in Kansas City.