Philip Morris CEO Grabs a Golden Parachute

The outgoing CEO of Phillip Morris, International Inc. (NYSE:PM)–Louis Camilleri–received a compensation package valued at more than $24.7 million for fiscal 2012. This was approximately 23% more than he received the year before, reports the Charlotte Observer. The compensation package was revealed in an SEC filing by Phillip Morris on Thursday, which the Associated Press analyzed.

Phillip Morris International’s net income grew to $8.8 billion, a 2.4% increase, during 2012. The Richmond, Virginia based company sells Marlboro and other brands of cigarettes overseas. Both revenue (excluding excise tax) and cigarette shipments rose approximately 1% to $31 billion and 927 billion respectively. In 2011, Camilleri’s compensation totaled about $20.1 billion.

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After a planned annual shareholder meeting on May 8th in New York, Camilleri will step down as CEO. At the meeting, shareholders will elect 13 directors to the company’s board. Phillip Morris International is the second largest cigarette company in the world, second only to China National Tobacco Corp., which is state-controlled. Phillip Morris International is separate from Phillip Morris USA, which sells the Phillip Morris brands (most notably Marlboro) in the United States.

For fiscal 2012, the 58-year old Camilleri received $1.75 million in salary and a $7.5 million performance bonus, according to the Washington Post. He also received stock awards of $15 million–a 65% increase from the year before. Other compensation Camilleri received from the company in fiscal 2012 is valued at $460,239 and includes a car allowance of $19,602 and personal flights on company planes that are valued at $178,137.

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The formula the Associated Press uses to calculate CEO total compensation for a fiscal year is slightly different than what SEC filings reflect. This is due to the AP not figuring in changes in present value of pension benefits. Also, the value of a CEO’s stock awards is dependent on the stock retaining its current value after the CEO leaves. It is normal for stock awards to require a specific waiting period before they can be redeemed.

Camilleri will still remain as chairman of Phillip Morris International after he steps down on May 8th. He will be replaced as CEO by current COO Andre Calantzopoulos.

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