Reynolds American CEO Daniel M. Delen awarded compensation package totaling US$10.5M in fiscal 2013, about 21% higher than previous year, according to AP analysis of regulatory filing

RICHMOND, Virginia , March 21, 2014 () – Reynolds American Inc., the nation's second-biggest tobacco company, awarded its CEO Daniel M. Delen a compensation package valued at $10.45 million in fiscal 2013, about 21 percent more than the previous year, according to an Associated Press analysis of a regulatory filing.

The pay package came in a year when the maker of Camel and Pall Mall cigarettes, and Kodiak and Grizzly smokeless tobacco saw its profit rise 35 percent to $1.72 billion and its revenue excluding excise taxes fall less than a percent to $8.24 billion.

Reynolds sold 7 percent fewer cigarettes than the year before. Its U.S. retail share fell 0.4 percentage points to 26 percent of the market.

The company, based in Winston-Salem, N.C., said smokeless tobacco volumes grew 6.5 percent and it claimed 33.2 percent of the U.S. retail market.

The compensation deal was disclosed in the company's annual proxy filing with the Securities and Exchange Commission on Friday.

Delen received a salary of nearly $1.1 million and a $2.5 million performance-based bonus. Delen also received stock awards valued at about $6.6 million and other compensation worth $223,201.

The 48-year-old, who has served as CEO since March 2011, received $8.65 million in 2012.

Reynolds American will hold its annual meeting May 8 at its headquarters, where shareholders vote to elect six directors to its board and vote on two shareholder proposals, including one to stop animal testing.

The Associated Press formula calculates an executive's total compensation during the last fiscal year by adding salary, bonuses, perks, above-market interest that 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 2013 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.

Michael Felberbaum can be reached at http://www.twitter.com/MLFelberbaum.

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© 2019 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.