The median raise for the chief executives of Idahos publicly traded companies was 12 percent in each companys latest fiscal year. Only one CEO among the nine took a pay cut.
When compared with overall Idaho employee pay, the CEOs came out way ahead. Idaho workers median hourly wage rose by half a percent in 2013. The median hourly pay for all Idaho CEOs, across all industries, went up by 5.5 percent between 2012 and 2013.
The national average for CEO raises in total compensation was 5 percent to 5.5 percent, according to compensation consultant Steven Hall, founding partner and managing director of Steven Hall & Partners in New York.
Idahos publicly traded companies generally are in line with a national trend toward tying top executives pay to long-term performance. At least one Idaho company, Hecla Mining Co., changed its compensation structure to make it easier for shareholders to decide whether the executive earned his or her pay another national trend.
What (U.S. companies are) all trying to do now is tell shareholders, Hey, look at us, were not only paying people for showing up, were paying them for performance, Hall said.
Publicly traded companies often expect top executives to own shares in the company and often give them performance incentives in the form of stock awards. For those executives, a raise in base salary or a one-time bonus plays a smaller role in a pay raise than it would for rank-and-file employees.
What really benefited executives over the 2013 calendar year is the performance of the stock market, said Beth Wright, seniorconsultant in executive compensation for Towers Watson in Seattle, referring to national averages as opposed to Idaho companies.
There have been big changes in the landscape of Idahos public companies since the Statesmans survey a year ago. The roster of CEOs went from 13 to nine. Boise Inc. and Home Federal Bancorp were bought by other companies. Coeur Mining moved to Chicago. Coldwater Creek went bankrupt. Their CEOs were ranked Nos. 3, 6, 8 and 9 in total pay last year.
Coldwater Creeks bankruptcy judge this month approved a plan to pay executives to stay on staff during the wind-down of the business. The company initially wanted to pay as much as $4.64 million to the executives, but the bankruptcy trustee responsible for making sure creditors get paid objected. Coldwater Creek eventually agreed to a maximum of $2.5 million.
What remained in fiscal year 2013 was a crop of generally healthy companies and high-paid executives. Here they are, ranked by total pay, which does not include change in pension value and other deferred compensation:
1. MARK DURCAN, MICRON
Micron grew up in 2013.
After a spotty record of profitable years, laying off thousands of workers and trying to establish itself as a bigger player in the memory market, Micron bought Japans crippled Elpida Memory Inc. and strode into the major leagues.
It ended 2013 with a $1.19 billion profit, after a $1.03 billion loss in 2012. Its stock shot up 243 percent.
The good news was tempered by the announcement of 1,500 layoffs worldwide, about 5 percent of the workforce.
If the company had been handing out bonuses, CEO Durcan would have added $1.4 million to his pay for meeting performance goals. But directors cited market conditions for not offering performance bonuses in 2013. Durcans compensation rose 12 percent, mostly due to stock awards.
Durcans $6.9 million compensation was called a bargain by The Wall Street Journal. The newspaper noted that he led the company to a 120 percent return.
2. THOMAS E. CARLILE, BOISE CASCADE CO.
Boise Cascade Co. started publicly trading on the New York Stock Exchange in March as its private equity owners cashed out. The new company is a smaller version of the late, great Boise Cascade Corp., sans the papermaking and timber businesses.
Its stock opened Feb. 11, 2013, at $27.15 and closed fiscal year 2013 (end of January 2014) at $29.48. The stock closed Friday at $28.78.
Sales increased nearly 18 percent in 2013, to $3.3 billion. Profits doubled to $99 million, continuing a rebound from the companys $27 million loss in 2011.
The recovering homebuilding industry, which saw an estimated 22 percent more starts in 2013 than the year before and a 41 percent increase from 2011, fueled Boise Cascade. Carlile, whose base salary is set at the 50th percentile of CEOs in his industry, saw an 8.8 percent hike. He also received an increase in incentive pay after the company reached financial targets.
3. PHILLIPS S. BAKER JR., HECLA MINING CO.
The bad news for the Coeur dAlene company was that it reported a $25.7 million loss in 2013.
The good news is that it spent $28 million on resuming operations at its best silver-producing mine the Lucky Friday in North Idaho and on buying the company that previously owned what is now Heclas best gold producer, Casa Barardi in Quebec, Canada.
Hecla produced 8.9 million ounces of silver, a 39 percent increase from 2012. The company also mined nearly 120,000 ounces of gold, including more than 62,000 ounces at Casa Barardi, doubling 2012 production.
The increased volume helped to offset a 23.5 percent drop in the average price of silver and a 15.5 percent drop in the average price of gold from 2012 to 2013.
Bakers total compensation fell 2 percent. The board of directors voted to reduce the CEOs performance incentive by 25 percent due to the decline in Heclas share price from $5.63 at the end of 2012 to $3.08 at the close of 2013. It was $3.27 Friday.
Hecla announced a new compensation program starting in 2014 in response to shareholder complaints that incentive payout metrics werent transparent enough. The new program will measure incentives against gold and silver production goals.
4. J. LAMONT KEEN, IDACORP
Idaho Power, the main subsidiary of IdaCorp, boasted a sixth consecutive year of earnings growth. After 39 years at the company, Keen stepped down as CEO at the end of 2013. He stuck around through April to complete a leadership changeover to Executive Vice President and Chief Financial Officer Darrel Anderson, who received a 19 percent raise in his base salary in 2013.
Keen left behind a healthy company. IdaCorp had 5.4 percent more net income and 15.3 percent more operating revenue in 2013 than in 2012. He couldnt take credit for all of that extreme summer and winter weather boosted demand for electricity but the companys management praised his continued strong leadership during a period of transition to new senior leadership.
The compensation committee, while evaluating how well Keen performed in his final year, said it paid attention to how well the company did financially in 2012, Keens active management of the budget, and emphasis on improvements in safety and compliance.
5. JEFFREY R. FEELER, U.S. ECOLOGY INC.
The Boise company underwent a leadership shakeup in 2013, and its double-digit growth streak carried over into 2014.
The companys source of revenue shifted away from government jobs and more toward private cleanup projects in 2013. Private sector work grew by 188 percent year-over-year, mostly from a nuclear power plant decommissioning project and an East Coast cleanup project. Government business declined by 45 percent.
In May, Feeler took over as CEO and other executives moved into higher positions. The shakeup came with the unexplained termination of former CEO James R. Baumgardner.
Feeler did not receive bonuses in 2013 but did receive stocks, options and other incentive-based compensation.
6. JAMES F. CLEARY JR., MWI VETERINARY SUPPLY
MWI is one of Boises fast growers, with gross profit climbing 30 percent in 2013. It has acquired several businesses in the past few years. In 2013, it bought Ivesco Holdings, which increased MWIs presence on the East Coast and in the South and Midwest.
As it grew through acquisitions, MWIs executives took on more work and revenues grew, so the board gave its executives a raise.
Cleary is on track for a major pay boost in 2014. The companys compensation committee voted to raise his base salary by 29 percent to $500,000 with the possibility of a 110 percent bonus.
7. CURT HECKER, INTERMOUNTAIN COMMUNITY BANCORP
The banking holding company more than tripled its 2012 profits in 2013, to more than $11.8 million.
A slight decrease in the combined assets of its three subsidiary banks was more than offset by a nearly $8 million reduction in charge-offs uncollectible loans written off as losses including a $3.8 million drop in commercial construction charge-offs.
Intermountain also paid back the full $27 million in Troubled Asset Relief Program funds borrowed from the U.S. Treasury when the bank was struggling in 2009. Bank executives werent allowed to earn incentives, stock options or bonuses under terms of the TARP loan. Repaying the money made Hecker eligible for those payments, resulting in his total compensation for 2013 more than tripling. His base pay increased 14.5 percent.
8. DENNIS J. GILLES, U.S. GEOTHERMAL
The Boise companys sales of electricity derived from geothermal projects nearly tripled in 2013, to $27 million. The biggest gains were at the Neal Hot Springs site in Oregon, where U.S. Geothermal completed construction on a 22-megawatt plant. Sales there increased from $2.3 million in 2012 to $15.6 million last year.
Gilles replaced the retiring Daniel J. Kunz in April. Gilles base salary of $375,000 (prorated to $261,250 for his April start) will increase to $410,000 this year. In addition to stock options, Gilles can double his salary with performance bonuses, which will be determined at the boards discretion.
9. PAUL DIRCKSEN, TIMBERLINE RESOURCES
The ambitious and perpetually in-the-red exploration company is Idahos little engine that could. The New York Stock Exchange continues to warn of its delisting, as shares trade for pennies and losses persist, but Timberline has found ways to hang on.
Dircksen, in his late 60s, became CEO of Timberline in March 2011. He and other executives received salary raises after the compensation committee looked at pay for other public companies, the company said. The panel chose last year not to issue stock awards or stock options to reward executives; the previous year it had given out both. That decision made Dircksen the only CEO among Idahos publicly traded companies to take a pay cut in fiscal 2013.
Timberline ended its 2013 fiscal year with $3.72 million in net losses from continued operations about half the loss Timberline reported the previous year, largely because of a $2.7 million decrease in spending on exploration at a Nevada site that Timberline management believes has excellent potential for continued exploration success.
In September, the last month of its FY 2013, the company offered five million shares of common stock to the public at 20 cents a share to raise money for its Lookout Mountain project in Nevada.
We are a gold exploration company and, as such, are prerevenue, said Randal Hardy, chief financial officer for Timberline. Exploration companies, much like bio-tech companies, generally rely upon equity financings for funding until a source of revenue is generated.