The pay package for the president and CEO of candy maker Hershey's increased 16 percent last year to $7.4 million, according to Associated Press calculations of data in a regulatory filing Tuesday.
The increase for Hershey Co. President and CEO David West mainly resulted from higher stock and option awards. West received a salary of just over $1 million in 2010 _ it was $30,000, or 3 percent, higher than in 2009 _ and no cash bonus in either year.
Stock and option awards rose to $4 million, up from $3 million, while he also received about $180,000 in perks, including $137,000 from a supplemental 401(k) match and $21,000 for personal use of the company's aircraft.
West, 47, joined Hershey in 2002 and was promoted to CEO in 2007 amid slumping sales and a front-office shakeup. He has engineered a solid performance since, pouring money into advertising and pushing into fast-growing foreign markets.
In 2010, the maker of Reese's, Twizzlers and Hershey's Kisses reported income and revenue gains well above the company's long-term objectives. Revenue was $5.67 billion, up 7 percent from 2009, while net income was $509.8 million, up 17 percent.
According to the company filing, executives are rewarded if the company achieves strong financial performance relative to goals and its stock price rises. Hershey closed at $47.15 Dec. 31, up $11.36, or 32 percent, from a year earlier.
Under West, Hershey also lost out to Kraft Foods Inc. in the bidding for British rival Cadbury PLC, although some analysts had warned that the acquisition would have unwisely stretched Hershey's finances.
The Associated Press 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.
Hershey will hold its annual meeting April 28 in Hershey, Pa., where it is based.