Pepco Holdings Executive Gets $4.3M Pay Package
The Associated Press
03/30/09 - 03:16 PM EDT
WASHINGTON (AP) — Dennis Wraase, the retiring top executive of utility and power generator of Pepco Holdings Inc., saw his total compensation package decline 4 percent to $4.3 million in 2008, according to an Associated Press calculation of figures disclosed in a regulatory filing.
But about a third of the compensation package came in the form of stock options that currently have little value absent a major jump in the company's stock price.
Wraase, who stepped down as CEO on March 1 and will retire as chairman at the company's annual meeting on May 15, received a salary of $1.1 million and performance-based bonuses of $968,400 for 2008, according to the filing with the Securities and Exchange Commission on Wednesday. His salary for 2007 was $1 million and his bonus totaled $1.1 million.
About one third of the compensation came from stock options worth $1.2 million when they were awarded in January 2008 when Pepco Holdings stock was trading at $26.
Like many other utilities and power generators in the past year, the stock of Pepco Holding has been hammered by the recession and the declining stock market, losing more than half its value in the past year. Its shares fell 88 cents, or 6.8 percent, to $12.14 in trading Monday afternoon.
Wraase's package includes other compensation of $351,849, much of related it to stock awarded to Wraase. Wraase received $190,641 for the market value of shares that Wraase received under the stock award cycle of 2006 to 2008 had the shares been issued to Jan. 1, 2006. He also received dividends of $85,235 on unvested shares of restricted stock he holds.
Wraase got a pay package valued at $4.5 million in 2007.
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 SEC, which reflect the size of the accounting charge taken for the executive's compensation in the previous fiscal year.
Pepco Holdings earned $393 million, or $1.93 per share, in 2008 compared with $296 million, or $1.53 per share, in 2007. Discounting charges, Pepco Holdings made $300 million, or $1.47 per share, in 2008 compared with $334 million, or $1.72 pre share, in 2007.
Revenue rose to $10.7 billion in 2008 from $9.4 billion in 2007.
In response to the credit crisis, Pepco Holdings has frozen hiring and management salaries, reduced operating budgets and scaled back its 2009 and 2010 construction programs.
Pepco Holdings delivers electricity and natural gas to about 1.9 million customers in Delaware, the District of Columbia, Maryland, and New Jersey, through its subsidiaries Pepco, Delmarva Power and Atlantic City Electric. It also provides competitive wholesale generation services.
