CINCINNATI - The Kroger Co.'s highest-paid executives took pay cuts of 11 to 17 percent in 2012, according to figures disclosed in regulatory filings Tuesday.
Kroger had a strong year by most financial metrics, with a $1.5 billion profit on revenue of nearly $97 billion. But it fell short on the one measure of profitability on which cash bonuses were based. As a result, the four highest-paid company officers made about $2.6 million less in bonuses than last year.
For CEO David Dillon, that meant a 13 percent overall pay cut to $7.8 million in 2012. Dillon received base salary of $1.3 million. Restricted share grants and stock options were worth a combined $4.7 million. Both categories were within a few percentage points of last year's pay levels. But his bonus award of $1.3 million was about $1 million less than his pay from last year.
According to Kroger's annual proxy statement to shareholders, the key performance measure was earnings before interest, taxes, depreciation and amortization (EBITDA) on all sales excluding fuel. To achieve the maximum bonus award, the company needed to reach $4.22 billion. It fell $102 million short of the goal.
As a result, Chief Financial Officer J. Michael Schlotman took an 11 percent pay cut to $2.2 million. Total pay was down 17 percent to $3.6 million for Chief Operating Officer Rodney McMullen. General Counsel Paul Heldman took home $2.7 million in total compensation, down 14 percent from last year.