Costco CEO James Sinegal saw his compensation fall 38% to US$2.2M in fiscal year 2011
December 14, 2011
– Costco Wholesale Corp. CEO James Sinegal saw his compensation fall 38 percent to about $2.2 million for the company's 2011 fiscal year, according to a regulatory filing.
The executive had total compensation valued by the company at $3.5 million in fiscal 2010.
Costco, the nation's biggest wholesale club operator, maintained Sinegal's fiscal 2011 salary at $350,000 and increased his bonus by 4 percent to $198,400, according to documents filed with the Securities and Exchange Commission.
Costco has seen its profitability grow during the economic downturn as it focused on prices and shoppers turned to its clubs for deals on food and necessities. The Issaquah, Wash., company reported that its fiscal 2011 net income rose 12 percent to $1.46 billion, or $3.30 per share, while revenue climbed 14 percent to $88.92 billion.
The 75-year-old Sinegal received stock and options with an estimated value of nearly $1.6 million, which was 46 percent lower than the approximately $2.9 million a year ago. He also received $81,206 in other perks such as insurance premiums and a car allowance. This was a 13 percent decline from the $93,004 in other perks that Sinegal received in the prior-year period.
The Associated Press formula calculates an executive's total compensation during the last fiscal year by adding salary, bonuses, perks, above-market interest the company pays on deferred compensation and the estimated value of stock and stock options awarded during the year. The AP formula does not count changes in the present value of pension benefits. That makes the AP total slightly different in most cases from the total reported by companies to the Securities and Exchange Commission.
The value that a company assigned to an executive's stock and option awards for 2011 was the present value of what the company expected the awards to be worth to the executive over time. Companies use one of several formulas to calculate that value. However, the number is just an estimate, and what an executive ultimately receives will depend on the performance of the company's stock in the years after the awards are granted. Most stock compensation programs require an executive to wait a specified amount of time to receive shares or exercise options.
Costco will hold its annual shareholders meeting on Jan. 26, 2012 in Bellevue, Wash.
© 2021 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.