Masco chief tops '04 salary scorecard
Ethan Allen, Tempur-Pedic execs also among top earners
By Jay McIntosh -- Furniture Today, September 5, 2005
High Point — Masco's Richard Manoogian, longtime leader of one of the industry's most profitable companies, was the only eight-figure earner on Furniture/Today's 2004 salary scorecard with total compensation of $15.7 million.
In a distant second place was Farooq Kathwari, CEO of retailer and manufacturer Ethan Allen, who took in $8.2 million.
Both men reaped most of their rewards by cashing in stock options, which boards of directors generally grant as incentives for executives to support a company's stock price and as kudos for long-term good performance. Executives usually cash in their options when it makes sense for them to, like when the options are about to expire.
This year's list of the highest-paid executives at industry companies that are required to report such figures, generally because their stock or debt is publicly traded, includes 22 who earned more than $1 million. That was up a little from the 20 million-dollar breadwinners in the 2003 year.
Of the executives that appeared on the list in both years, 28 earned more in 2004 than in 2003 and 19 took home less.
Manoogian's compensation jumped sharply from $3.9 million in 2003, when he exercised no stock options. His 2004 bonus of $3 million also was up 25% from the previous year. Masco, which sells mainly plumbing and cabinet products but also owns ready-to-assemble furniture makers Mill's Pride, Tvilum-Scanbirk and d-Scan, had strong financial performance in 2004 with sales up 14.2% to $12.1 billion and earnings rising 10.8% to $893 million.
Kathwari's Ethan Allen also remained among the industry's profit leaders, with sales rising 5.3% in the fiscal year ended June 30, 2004, and earnings up 6.6%.
Also cashing in last year were two executives from Tempur-Pedic, the fast-growing maker and marketer of visco elastic mattresses and pillows. CEO Robert Trussell Jr. had total compensation of $7.5 million, and President Thomas Bryant raked in $3.6 million.
Tempur-Pedic was one of the hottest home furnishings companies last year, with sales jumping 42.9% and earnings nearly doubling.
Among publicly owned suppliers, last year's highest paid executive was Richard Rompala, who was CEO of finish supplier Valspar. He exercised options worth $4.3 million on his way to a total payday of $6.9 million.
Rompala stepped down from his Valspar post this February, remaining chairman of the company's board until recently, while William Mansfield was promoted to president and CEO.
Also in the earnings strato-sphere in 2004 was Charlie Loudermilk, longtime head of fast-growing rental and rent-to-own company Aaron Rents. He earned $6.8 million, mainly from exercising stock options, in a year in which the Atlanta-based company saw its revenues climb 23.4% and profits soar 44.4%. It was the latest in a string of good years for Aaron's, whose Sales and Lease Ownership division is among the fastest-growing RTO operations.
Tempur-Pedic wasn't the only bedding company represented near the top of the pay ladder. Lawrence Rogers and Dave McIlquham of Sealy each earned about $3.5 million. That included a significant payout associated with the company's April 2004 recapitalization and sale to Kohlberg Kravis Roberts.
Executives at Simmons saw some of the biggest pay cuts from 2003 to 2004. Chairman and CEO Charlie Eitel took in $1.1 million last year, down from $30.3 million in '03, while Chief Financial Officer Bill Creekmuir's pay fell to $845,885 from $11.5 million. In 2003, Eitel, Creekmuir and other Simmons executives benefited from a buyout of their company that resulted in big one-time payments.
Simmons had announced last year that it planned to follow the buyout deal with an initial public offering of stock, but this June it announced it was shelving the IPO move because of "market conditions and strategic reasons."
Sealy, meanwhile, said in a Securities and Exchange Commission filing in June that it plans to conduct its own IPO.
Also looking at an IPO is manufacturer Berkline/Bench-Craft, whose top three executives are on the salary scorecard for the first time. President and CEO Bill Wittenberg earned $562,500 last year, and executive vice presidents Dal Eckard and Larry Musick each had compensation of $450,000 — fairly modest levels considering the company is the eighth-largest U.S. residential furniture maker with 2004 sales of $499.7 million.
Look for them to reap greater rewards when the IPO takes place.
Among retailers, the highest paid, again because of the exercise of options, was Williams-Sonoma Chairman Howard Lester. He took in $5.8 million in 2004.
Laura Alber, president of Williams-Sonoma's Pottery Barn division, was the second-highest-paid woman at the industry's publicly held companies last year, collecting $2.2 million, primarily through options.
Tops among women was Noel Schenker of bedding manufacturer and retailer Select Comfort, at $2.3 million. (Schenker left the company in March of this year.)
Two other women also were among the 69 executives on this year's survey. Patricia McKay earned $497,346 at retailer Restoration Hardware, while Bea Spires collected $330,800 from Quaker Fabric.
| Executive, company | Salary | Bonus | Other annual income | Options exercised | Total |
| 1. Fiscal year ended August 2004. 2. Fiscal year ended June 2004. 3. Fiscal year ended April 2005. 4. Fiscal year ended May 2, 2004. |
|||||
| RETAILERS | |||||
| W. Howard Lester, Williams-Sonoma | $975,000 | $731,300 | $99,397 | $3,964,500 | $5,770,197 |
| Marvin J. Girouard, Pier 1 Imports | 1,000,000 | 0 | 44,656 | 1,811,966 | 2,856,622 |
| Laura Alber, Williams-Sonoma | 474,356 | 246,000 | 0 | 1,472,530 | 2,192,886 |
| Murray H. Dashe, Cost Plus | 575,000 | 60,825 | 0 | 1,396,781 | 2,032,606 |
| Jay R. Jacobs, Pier 1 Imports | 365,000 | 0 | 29,100 | 593,740 | 987,840 |
| John J. Luttrell, Cost Plus | 300,000 | 45,150 | 0 | 341,913 | 687,063 |
| Clarence H. Smith, Havertys Furniture | 400,000 | 160,000 | 3,000 | 0 | 563,000 |
| Clarence H. Ridley, Havertys Furniture | 400,000 | 150,000 | 3,000 | 0 | 553,000 |
| Gary G. Friedman, Restoration Hardware | 539,615 | 0 | 11,400 | 0 | 551,015 |
| Rami Abada1, Jennifer Convertibles | 542,800 | 0 | 0 | 0 | 542,800 |
| Patricia A. McKay, Restoration Hardware | 366,346 | 125,000 | 6,000 | 0 | 497,346 |
| Harley J. Greenfield1, Jennifer Convertibles | 440,700 | 0 | 0 | 0 | 440,700 |
| Brian N. Priddy, The Bombay Company | 315,200 | 0 | 0 | 115,127 | 430,327 |
| Wayne Badovinus, Design Within Reach | 400,000 | 0 | 0 | 0 | 400,000 |
| Stephen Farley, The Bombay Company | 266,539 | 0 | 0 | 57,495 | 324,034 |
| Robert Forbes, Design Within Reach | 250,000 | 0 | 0 | 0 | 250,000 |
| MANUFACTURERS | |||||
| Richard A. Manoogian, Masco | $1,500,000 | $3,000,000 | $0 | $11,238,000 | $15,738,000 |
| M. Farooq Kathwari2, Ethan Allen | 873,800 | 1,073,000 | 0 | 6,289,200 | 8,236,000 |
| Robert Trussell Jr., Tempur-Pedic | 400,000 | 240,000 | 3,455,924 | 3,448,724 | 7,544,648 |
| Alan Barry, Masco | 950,000 | 1,520,000 | 0 | 3,358,000 | 5,828,000 |
| R. Thomas Bryant, Tempur-Pedic | 300,000 | 180,000 | 1,565,854 | 1,558,654 | 3,604,508 |
| Lawrence J. Rogers, Sealy | 293,282 | 160,482 | 126,974 | 2,912,398 | 3,493,136 |
| David J. McIlquham, Sealy | 575,417 | 542,293 | 1,030,794 | 1,320,534 | 3,469,038 |
| William R. McLaughlin, Select Comfort | 600,000 | 182,135 | 0 | 2,238,137 | 3,020,272 |
| Albert L. Prillaman, Stanley Furniture | 300,000 | 0 | 6,398 | 2,265,341 | 2,571,739 |
| Warren G. Holliman, Furniture Brands International | 925,000 | 804,380 | 0 | 755,250 | 2,484,630 |
| Noel F. Schenker, Select Comfort | 273,000 | 61,336 | 0 | 2,001,565 | 2,335,901 |
| John T. Foy, Furniture Brands International | 518,013 | 528,482 | 0 | 611,363 | 1,657,858 |
| Charles R. Eitel, Simmons | 675,000 | 322,933 | 72,460 | 0 | 1,070,393 |
| Jeffrey R. Scheffer, Stanley Furniture | 370,008 | 445,000 | 146,550 | 30,834 | 992,392 |
| Gerald M. Birnbach, Rowe Furniture | 922,231 | 0 | 53,061 | 0 | 975,292 |
| Kurt Darrow3, La-Z-Boy | 604,080 | 316,794 | 0 | 46,771 | 967,645 |
| K. Bruce Lauritsen2, Flexsteel Inds. | 390,600 | 230,425 | 0 | 246,233 | 867,258 |
| William S. Creekmuir, Simmons | 370,000 | 132,761 | 343,124 | 0 | 845,885 |
| Patrick H. Norton3, La-Z-Boy | 427,532 | 182,322 | 0 | 110,700 | 720,554 |
| Thomas D. Burkart2, Flexsteel Inds. | 224,460 | 125,876 | 0 | 327,163 | 677,499 |
| Michael E. Thomas, Chromcraft Revington | 418,000 | 38,099 | 136,326 | 0 | 592,425 |
| C. William Wittenberg, Berkline/BenchCraft | 375,000 | 187,500 | 0 | 0 | 562,500 |
| Larry R. Musick, Berkline/BenchCraft | 300,000 | 150,000 | 0 | 0 | 450,000 |
| Dalthard M. Eckard, Berkline/BenchCraft | 300,000 | 150,000 | 0 | 0 | 450,000 |
| Paul B. Toms, Hooker Furniture | 249,997 | 185,130 | 0 | 0 | 435,127 |
| Douglas C. Williams, Hooker Furniture | 241,201 | 185,130 | 0 | 0 | 426,331 |
| Craig Stout2, Ethan Allen | 186,250 | 55,000 | 0 | 164,250 | 405,500 |
| Robert H. Spilman Jr., Bassett Furniture | 318,000 | 23,751 | 0 | 0 | 341,751 |
| Barry A. Birnbach, Rowe Furniture | 259,858 | 0 | 0 | 0 | 259,858 |
| Frank T. Kane, Chromcraft Revington | 218,333 | 13,267 | 0 | 0 | 231,600 |
| Keith R. Sanders, Bassett Furniture | 190,000 | 7,477 | 0 | 0 | 197,477 |
| RENTAL, RENT-TO-OWN | |||||
| R. Charles Loudermilk Sr., Aaron Rents | $454,000 | $853,435 | $0 | $5,470,708 | $6,778,143 |
| Robert D. Davis, Rent-A-Center | 265,000 | 47,700 | 0 | 1,274,218 | 1,586,918 |
| William K. Butler Jr., Aaron Rents | 400,000 | 199,825 | 0 | 418,719 | 1,018,544 |
| Mark E. Speese, Rent-A-Center | 650,000 | 142,500 | 0 | 0 | 792,500 |
| William E. Morgenstern, Rent-Way | 500,000 | 100,000 | 0 | 0 | 600,000 |
| David Kraemer, Bestway | 300,000 | 84,157 | 0 | 0 | 384,157 |
| William Short, Rent-Way | 250,000 | 110,000 | 0 | 0 | 360,000 |
| R. Brooks Reid, Bestway | 150,000 | 0 | 0 | 0 | 150,000 |
| SUPPLIERS | |||||
| Richard M. Rompala, Valspar | $973,307 | $1,618,559 | $0 | $4,336,704 | $6,928,570 |
| Felix E. Wright, Leggett & Platt | 814,692 | 474,096 | 3,925 | 0 | 1,292,713 |
| David S. Haffner, Leggett & Platt | 641,746 | 325,094 | 2,284 | 0 | 969,124 |
| Robert F. Hruby, CFC International | 531,217 | 290,534 | 0 | 0 | 821,751 |
| Robert G. Culp4, Culp | 416,000 | 353,600 | 0 | 0 | 769,600 |
| Steven L. Erdahl, Valspar | 419,115 | 195,000 | 0 | 143,438 | 757,553 |
| Thomas E. Chorman, Foamex International | 715,401 | 0 | 0 | 0 | 715,401 |
| Larry A. Liebenow, Quaker Fabric | 682,000 | 0 | 0 | 0 | 682,000 |
| Howard L. Dunn Jr.4, Culp | 364,000 | 309,400 | 0 | 0 | 673,400 |
| Gregory Jehlik, CFC International | 271,442 | 151,016 | 29,438 | 0 | 451,896 |
| M. Beatrice Spires, Quaker Fabric | 330,800 | 0 | 0 | 0 | 330,800 |
| Nick C. Costides, Foamex International | 285,577 | 0 | 0 | 38,050 | 323,627 |
| Jon T. Baker, Decorize | 68,769 | 0 | 64,350 | 0 | 133,119 |
| Shane Matthews, Decorize | 54,856 | 0 | 71,486 | 0 | 126,342 |
