2002 wasn't a great year for cable TV company stocks, but it worked out pretty well for cable TV company CEOs.
And though stock option grants to entertainment executives may have fallen in 2001, that decline was offset, it appears, by increased cash compensation.
Those are two noteworthy takeaways from
recent survey of pay among executives at cable TV operators and other publicly traded electronic media companies.
As cable investors don't need to be reminded, calendar 2002 wasn't a great year for cable stocks, as concerns about inaccurate accounting, capital expenditures and cash crunches pushed share prices down through the summer, then allowed only a limited recovery.
Shares in three of the major cable operators --
-- dropped from 35% to 45% for the year.
Yet CEO pay at those three companies rose in 2002. Comcast CEO Brian Roberts -- who arguably deserves recognition, cash or otherwise, for completing the purchase of
cable business -- saw his pay rise 8% to $21.4 million in 2002. Insight CEO Michael Willner's pay jumped 63% while the stock fell 49%, though his $1.3 million 2002 compensation is but a fraction of Roberts'.
Cox CEO James Robbins' pay more than doubled in 2002 as Cox's stock fell 32%.
Pay to the Chief
Click To Enlarge Table
Pay was calculated by adding salary, bonus and other compensation to the present value of stock and option grants at the time they were awarded.
That contrast of rising pay amid falling stock wasn't played out at other entertainment companies, though. Shares in satellite operator
dropped 19%, for example; the compensation of its famously parsimonious EchoStar-stockholding CEO, Charlie Ergen, fell even farther, down 35% to $650,000.
What was apparent all over is that one element of compensation declines derived from outsized option grants in 2001 that weren't repeated in 2002.
AOL Time Warner
CEO Dick Parsons, for example, received options valued at $66.6 million when they were granted in 2001, but $2.1 million of options in 2002.
Of course, since AOL Time Warner's stock price fell in 2002, those options based on 2001 stock prices likely lost value in 2002, when prices fell.
Though Parsons' cash remuneration stayed flat from 2001 to 2002, other executives saw their salary and bonuses rise as their option grants fell. At
, CEO Sumner Redstone's option grants fell $5.4 million, but his cash bonus rose $4.5 million.
So, just like the case among rank-and-file workers, stock option grants may be less attractive in the executive suite. But cash never goes out of style.