Disney raised CEO Eisner's pay to $6 mln in 2002
Tuesday January 28, 10:38 PM EST
By Peter Henderson
LOS ANGELES, Jan 28 (Reuters) - Walt Disney Co.(DIS) paid Chairman and Chief Executive Michael Eisner $6 million last year and gave President and Chief Operating Officer Bob Iger a package, including a promotion-related bonus, worth more than $18 million, company filings showed on Tuesday.
Disney's board said it had rewarded Eisner for steering the company through tough times and laying the groundwork for future growth with a $5 million bonus, and it gave Iger options worth nearly $13 million after he extended his contract last year and to reflect new responsibilities.
The company, which reports its fiscal first quarter results on Thursday, has suffered through a travel downturn that slowed attendance at its theme parks.
It has had some success turning around ratings for its ABC broadcast network but saw its $140-million animation epic "Treasure Planet" flop at the box office. Disney shares fell 21 percent in 2002.
In an annual letter to shareholders also released on Tuesday, Eisner compared the current, tough situation to what he found when he was named Disney CEO in 1984.
Eisner, credited with engineering a turnaround when he took the helm, told shareholders Disney stock was undervalued and repeated the company's forecast for earnings to rise 25 percent to 35 percent in 2003, with "strong growth" in 2004.
Disney returned to a net profit in fiscal 2002 but Wall Street analysts on average do not expect it to surpass its 1997 earnings peak until fiscal 2005.
$5 MILLION BONUS
For fiscal 2002, Eisner received a $1 million salary and a $5 million bonus, which he elected to receive in restricted stock vesting over a four-year period. He earned $1 million in 2001 and did not receive a bonus.
The pay package for Iger, who last year extended his contract with Disney until September 2005, included $1 million in restricted stock and 1.75 million stock options valued at $12.6 million. The options carry a strike price of $21.05 and expire in 2011. Disney shares closed 10 cents higher at $16.85 on Tuesday.
The pay package reflected new duties assumed by Iger since his appointment as President and Chief Operating Officer in 2000 and the contract extension, Disney said. Other Eisner lieutenants also got options grants.
In December, Iger's $1.5 million salary was increased to $2 million. Iger took home about $1.6 million in 2001 and did not receive a bonus.
The board's compensation committee said that Eisner's bonus reflected his leadership through tough times and "ongoing efforts to set the groundwork for strengthening the company's future performance."
Disney's report for the fiscal first quarter ended in December will address lingering questions about the health of the company's three main units: theme parks, film and television, Gerard Klauer Mattison analyst Jeff Logsdon said.
"This quarter you have a number of factors that can strongly influence results," he said.
The theme parks, including
Disneyland and Disney World, are struggling with attendance that has been depressed since the Sept. 11 attacks. A potential war with Iraq -- or the threat of one -- could hurt travel more, analysts have said.
Meanwhile, ABC has been spending heavily to build a programming base for its turnaround, an expense partially offset by an improvement in advertising rates, analysts said.
The financial success of big Disney pictures. such as Miramax's "Gangs of New York", which debuted in late December, is unclear, but it has hit the mark with smaller budget comedies like "The Santa Clause 2" and "Sweet Home Alabama".
Analysts polled by Multex, on average, expect Disney to report earnings of 15 cents per share on $961.5 million in revenue, with earnings estimates ranging from 11 cents to 17 cents per share.
©2003 Reuters Limited.
wow! I'm SOOOO in the wrong occupation!
