The CEO and founder of Limited Brands Inc. received a 2010 pay package nearly double the year before, according to an analysis by The Associated Press as business improved for the parent of Victoria's Secret and Bath and Body Works as shoppers went back to buying small luxuries such as lingerie.
Leslie Wexner's total compensation totaled $20.1 million, up from $10.4 million in 2009, because of a hefty increase in stock and option awards and a higher performance-based bonus.
Wexner, who has been CEO of the company since he founded it in 1963, received a base salary of $1.9 million, even with last year. He received a performance-based bonus of $6.3 million, up 29 percent from 2009.
The bulk of his award came in the form of stock and option awards worth $11.6 million on the date they were granted, according to a filing with the Securities and Exchange Commission on Monday. That's nearly five times what he received in stock and option awards in 2009.
About $8.8 million of those awards consist of restricted stock contingent on the company achieving $100 million in operating income over each of the next five years, a threshold it has met every year since 1984, according to data from FactSet. That grant was awarded in recognition of the company's performance in 2010, including rising sales and profit margins.
Wexner, 73, received other compensation of $311,900, mainly for contributions to his retirement account and medical cost reimbursement.
In 2010, net income rose 80 percent while revenue rose 11 percent to $9.61 billion. The company's stock price surged 60 percent during the year.
Strength appears to be continuing in 2011.
Last week Limited, based in Columbus, Ohio, reported a robust 14 percent gain in revenue from stores open at least a year, sharply higher than analysts expected, driven by strength at its Victoria's Secret stores. The measure is considered a key gauge of financial health because it excludes stores that open or close during the year.
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 2010 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.