John F. Lundgren, chief executive of New Britain tool maker Stanley Works Co., received compensation last year valued at $4.6 million, down 18 percent from the previous year, according to an Associated Press analysis of a regulatory filing.
The 57-year-old CEO received a 2008 salary of $1 million, up about 4 percent from his 2007 salary, the company said. Lundgren also received a performance-based cash bonus $1.2 million, down nearly a third from the $1.7 million awarded the previous year.
Lundgren received perks valued at $318,619, compared with $323,240 in perks received in 2007. His perks last year included $231,000 in contributions to a 401(k) program, $49,091 for insurance and a $16,686 for use of a car.
Lundgren also received stock awards and options valued at $2.1 million in 2008, down from 2007 when he received stock awards and options valued at $2.6 million.
However, Stanley Works shares traded at mid-morning at at $28.38, well below the options’ strike price of $32.84. That means those awards currently have little value. At 11 a.m., Stanley shares were up $1.03, or 3.8 percent.
The AP’s compensation formula aims to isolate the value the company’s board placed on the executive’s total compensation package during the last fiscal year. It includes salary, bonus, performance-related bonuses, 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 Securities and Exchange Commission, which reflect the size of the accounting charge taken for the executive’s compensation in the previous fiscal year.
Stanley Works faced operational challenges last year, posting a 7 percent profit decline as sales increased 2 percent to $4.43 billion.
Stanley Works cited weakness in its construction and industrial segments and the effect of a stronger U.S. dollar.
In December 2008, the company said it would cut 2,000 jobs — about 10 percent of its work force — and close three manufacturing facilities.
The company’s response to the global recession has earned it praise on Wall Street.
“There is no question that Stanley Works is effectively managing what it can by covering cost inflation, executing aggressive work-force reductions and driving up working capital turns,” Deutsche Bank analyst Nigel Coe said Jan. 28 in a client note. (AP)
