By  on April 13, 2010

The recovery of high-end retailing in the second half of 2009 allowed the top executives of Nordstrom Inc. and Tiffany & Co. to comfortably pad their take-home pay last year.

According to proxy statements recently filed with the Securities and Exchange Commission, Nordstrom president Blake Nordstrom more than doubled his total compensation, to $4.3 million, while Tiffany chairman and chief executive officer Michael Kowalski earned $7.9 million, 68.4 percent higher than in 2008. In both cases, the companies exceeded earnings targets set by the compensation committees of their boards, opening the door for rich payoffs in nonequity incentive plan bonuses, even though neither firm matched nor exceeded its 2008 sales.

Meanwhile, Jones Apparel Group Inc. ceo Wesley Card saw his earnings fall 11.1 percent to $5.5 million, although his earnings effectively rose 2.2 percent when a 2008 bonus — reported to the SEC but not accepted by Card — is factored into the equation.

At Nordstrom, Blake Nordstrom’s total pay package of $4.3 million last year was 131.6 percent above his total earnings of $1.9 million for 2008. While his salary was unchanged, his reported pay grew 0.6 percent to $700,000 due to the timing of the fiscal year, and the sum of his stock and option awards declined 6 percent to $1 million.

Because Nordstrom exceeded target performance levels for both earnings before interest and taxes and return on invested capital, Nordstrom was entitled to 165.9 percent of his salary, or $1.2 million, in nonequity incentive plan compensation. This compared with zero in the prior year.

Because of fluctuating stock prices and vesting schedules, stock and option awards weren’t necessarily realized by the executives cited but are required to be filed with the SEC.

At least on paper, Nordstrom benefited from a $1.4 million credit for the change in pension value and nonqualified deferred compensation earnings, versus no change in 2008.

His other compensation declined 27.9 percent to $47,000, the majority of it derived from more than $32,000 in merchandise discounts used by himself and his eligible dependents.

In fiscal 2009, Nordstrom weathered the economic downturn better than many of its upscale retail peers. Net income grew 10 percent to $441 million, while sales pulled back 0.2 percent to $8.26 billion and retreated 4.2 percent on a same-store basis.

Tiffany easily met its earnings targets last year, entitling ceo Kowalski to a $2 million bonus and helping to lift his total compensation by more than two-thirds.

With his $7.9 million package, Kowalski, ceo of Tiffany since 1999 and chairman since 2003, earned 68.4 percent more than his 2008 take of $4.7 million.

The biggest portion of his $3.2 million increase was $2 million in nonequity incentive plan compensation, the maximum amount payable to its ceo, which kicked in when net earnings for the year exceeded the target of $116 million. Tiffany’s net income last year was $264.8 million, 20.4 percent above its 2008 level despite a 4.9 percent decline in sales to $2.71 billion.

The incentive bonus equals twice Kowalski’s annual salary of $1 million.

The sum of Kowalski’s stock and option awards grew 8.1 percent to $3.1 million from $2.9 million in 2008. Tiffany also recorded $1.6 million in change in pension value and nonqualified deferred compensation earnings for Kowalski, versus $454,000 in 2009.

All other compensation was nearly halved to $168,000 from $322,000.

Taking in $5.5 million last year, Jones’ Card earned $6.2 million in 2008, but that amount was reduced to $5.4 million when he declined the $810,000 in nonequity incentive plan compensation. He accepted the $2.4 million earned on that budget line last year.

Jones’ proxy said Card “voluntarily elected not to accept receipt of the cash award in recognition of business conditions in late 2008 and 2009 and the impact on associates of the company.” Jones engaged in aggressive cost cutting, including hundreds of store closures, as it fought to deal with the worst effects of the recession.

Card’s salary was unchanged at $1.6 million, and his $2.4 million incentive plan payment represented 150 percent of his salary based on the company registering operating income and operating cash flow more than 10 percent above target levels. These calculations exclude nonrecurring items, such as one-time charges for goodwill or store impairment.

Last year, Jones narrowed its net loss to $86.3 million from an impairment-laden loss of $765.4 million in the prior year. Revenues fell 8 percent to $3.33 billion.

Card received no option awards for last year’s performance, as in 2008, and the value of his stock awards fell 63.8 percent to $1.3 million from $3.6 million.

There was no change recorded in Card’s pension value or nonqualified deferred compensation earnings, as in 2008, and all other compensation rose 7.7 percent to $225,000.

Sidney Kimmel, chairman of the firm, recorded total compensation of $1.3 million, the same as in 2008, with $1.2 million in salary in both years.

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