One won’t find Richard Hayne’s name on a list of chief executive officers who make thousands of times more than their average employees.
This story first appeared in the April 3, 2013 issue of WWD. Subscribe Today.
Hayne, chairman, president and ceo of Urban Outfitters Inc., earned just $33,273 last year, according to the company’s definitive proxy filing with the Securities and Exchange Commission Tuesday, and that was a 7.3 percent increase from his 2011 compensation of $31,015.
Since 2009, Hayne has drawn a salary of $1 a year, even after returning to the ceo post following Glen Senk’s resignation as ceo of Urban early last year to take the same role at David Yurman Inc. As in the two prior years, Hayne collected a $5,000 holiday bonus but received no stock or option awards. The remaining $28,272 of Hayne’s compensation — 85 percent of the total — came in the “all other compensation” column of Urban’s compensation table and consisted solely of premiums paid by the company for automobile and life insurance policies.
Hayne collected a cash bonus of $420,000 in 2010 but hasn’t collected one since. Last year the company fell just short of the mark where such a bonus would have been activated. To qualify, revenues needed to reach $2.83 billion and operating income $377.1 million. Instead, the Philadelphia-based specialty retailer recorded revenues of $2.79 billion and operating profits of $374.3 million, which, while insufficient to trigger a cash payout, represented respective increases of 13 percent and 31.5 percent.
The ceo has more than a passing interest in seeing the company grow. With more than 27.4 million shares, 18.8 percent of the total outstanding, his stake in the firm is worth just nearly $1.1 billion and has shared in the escalation of retail stocks in the past year. On Tuesday, shares closed at $39.87, up $1.46 or 3.8 percent, and 35 percent higher than their close at $29.54 one year ago.
Hayne’s bonus was tied solely to corporate performance while other listed executive officers in the proxy were compensated on the basis of divisional performance, the achievement of specific goals or both. Ted Marlow, who returned to the company last year as ceo of the Urban Outfitters brand, earned just more than $1 million, including $597,000 in stock and option awards and $76,000 in a cash bonus. David McCreight, ceo of Anthropologie, took in $2.5 million, making him the highest paid of the five listed executive officers in the proxy. His total compensation was 44.8 percent below the prior-year level, as his $1.4 million cash bonus failed to offset the absence of stock and option awards, which in 2011 totaled $4.2 million.
Because of fluctuating stock prices and vesting schedules, stock and option awards aren’t necessarily realized by the executives listed as receiving them but, as required by the SEC, are reported by their employers at grant date fair value.
According to the proxy, Margaret Hayne, president of Free People and the ceo’s wife, earned $451,000 last year, while Hayne’s son David earned $415,000.
Hayne founded Urban Outfitters in 1970 and has served as its chairman and president since 1976.