I Could Bankrupt the Paper for Half the Price

The mainstream media love to complain about executive compensation.  Of course that doesn't apply to them. 

The head of the nation's largest newspaper chain received pay and compensation valued at $7.9 million in 2007, 36 percent higher than the previous year, according to an Associated Press analysis of corporate filings released Thursday.

Craig Dubow, chief executive, president and chairman of Gannett Co. (NYSE:GCI) , which publishes USA Today and 84 other daily newspapers in the United States, received compensation including pay, bonus and stock options valued at $5.79 million in 2006.

The increase came as Gannett stock, like that of other media companies, tumbled over the last year. In the last 12 months, Gannett stock has lost roughly half its value, from about $60 a year ago to $29.97 at the close of business Thursday.

Comments

[ron]

At my job when revenues go down, heads roll (and this is a 'non profit' operation). I guess I should work for Gannett - where if I reduce stock values 50% I get a raise!

[Joubert]

You have not much future at the Republic. It will happen this way. You may be walking through the newsroom. Maybe the first sunny day of the spring maybe a Friday and a Editor will slow beside you, a hand will be extended from someone you know, maybe even trust, you will be asked to meet in a conference room with your supervisor and a member of HR. And they will smile, a becoming smile. But, they will leave the door of the conference room open. And offer to give you a lift right out the front door :)

[Logical1]

Where is the real part of the story? They have been letting people go like crazy and the payroll is rising out of control?

I think former employees that were let go for financial reasons should form a class action suit and put the last nail in the coffin.

[BobH]

One of the sports team owner was asked several years ago if he minded the high price of talent. He replied that it wasn't the price of talent that bugged him, it was the high price of mediocrity.

I feel the same way about CEO salaries. If s/he is creating big profits for the shareholders, then a big compensation package (even something many times what I'll earn in a lifetime) may be totally justified. What bugs me is big pay for poor results and big severance packages.

To be fair, it's hard to discuss any single case -- what goals were given to Dubow by the board? If he's judged solely by the stock price he's a failure, but perhaps he was told to ignore short-term results and take some actions that the board felt would build for the future -- if he achieved that, then perhaps his pay is justified.

[SonoranSam]

Who SEZ the complaints about over-paid executives doesn't apply to Gannett?

As a former journalist, I will tell you that most of the major problems for newspapers these days were created by the folks we used to call "Gannett-toids" back in The Day.

They drove professional newspeople out of decision-making positions.

They developed a well-earned reputation for taking all the life, and all the controversy, out of the newspapers they ran, leaving behind a bunch of bland vanilla rags that few people enjoyed reading, but made obscene profits because advertisers would still spend their money promoting supermarkets, tire stores and department stores, and people would buy classified ads because they had no other option.

Now there are other options, and that's what's giving Greg so much glee as he watches the newspaper circle the porcelan throne.

But still, their executives reap ridiculous salaries. Now the cash cow is finally running dry, and it's time to unpack those golden parachutes and float off to Paradise Valley.

It ain't right, but what do I know? I'm just a fuzzy-headed liberal.

[karim0028]

I think we ought to look at the whole pic not just the headlines!

Dubow's ~7M compensation was mostly in stock options @ ~$61/share, so he didnt get much out of it.... Devil is in the details, his options are worthless, so his real compensation was close to 1.5-2M....

He also asked the board not to get a pay raise as the stock had been taken for a ride and he didnt feel that a raise was something that would be good for the company/shareholders...

He seems like a decent manager... The market forces are tough with the whole economy taking a dump....

[karim0028]

Here is a clipping from the CNN page... With more solid numbers

"In fact, the decreasing value of Gannett shares means that a large chunk of Dubow's 2007 compensation is currently without value.

The proxy statement filed to the Securities and Exchange Commission on Thursday shows that $3.35 million -- or 43 percent of his 2007 compensation -- came in the form of stock options granted in February at a strike price of $61.26 per share.

That means the stock options are effectively worthless until their value exceeds $61.26 a share. The options allow Dubow to buy the company's shares at that price.

The proxy statement shows that Dubow's salary and bonus are unchanged from 2006 to 2007, with a salary of $1.2 million and a bonus of $1.75 million. He also received $1.45 million in stock awards and $120,629 in other compensation, including an annual premium on a life insurance policy and home security system allowance.

In the filing, the company states that Dubow and other top executives asked Gannett's executive compensation committee to refrain from increasing the salary or bonus 'in light of the challenging business environment we currently face.'
The AP's total pay calculations include executives' salary, bonus, incentives, 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."