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2000 CFO Pay: Rite Aid’s Standley Earned More Than $4 Million

Drug store chain's new management richly rewarded for turnaround.
Michelle GabrielleMay 24, 2001

Rite Aid Corp., which is emerging from a 1998 accounting scandal, paid its senior EVP and CFO John T. Standley more than $4 million in total compensation in the fiscal year that ended March 3, 2001, according to the Camp Hill, Penn.-based drug store chain’s recently released proxy.

For their effort toward turning the company around, several of the company’s top officers were awarded “special bonuses” in fiscal 2001.

Standley was awarded a $528,317 bonus. He also received $739,231 in salary and $85,708 toward moving expenses and supplemental life insurance premiums paid by the company. He also was awarded $2,734,946 in restricted stock. His total compensation: $4,088,202.

The company’s chairman and CEO Robert G. Miller earned about $9.2 million, including a $1,268,991 bonus and more than $6.2 million in restricted stock.

Mary F. Sammons, Rite Aid’s president and chief operating officer, received a bonus of $768,930 and more than $5 million in restricted stock. Total compensation: $6,972,409.

In addition, the company’s senior EVP and chief administrative officer, David R. Jessick, received a bonus of $575,192 on top of his $812,000 salary and about $2.7 million in restricted stock. His total compensation came to $4,123,055.

Standley, Miller, Sammons, and Jessick all joined Rite Aid on December 5, 1999 with the charge to turn around the company, which was scrambling on the heels of the accounting scandal. Standley was promoted to senior EVP and CFO in September 2000.

Before joining Rite Aid, from May 1999 to December 1999 he was EVP and CFO of Fleming Companies, Inc., a food marketing and distribution company. Between July 1998 and May 1999, Standley was senior VP and CFO of Fred Meyer, Inc. He served as CFO of Ralphs Grocery Co. from January 1997 to July 1998 and of Food 4 Less from January 1997 to July 1998.

In 1999, Standley took home $1,110,385 in total compensation. He received $135,385 in salary, $825,000 in restricted stock, and $150,000 that represents a guaranteed bonus paid in April 2000 in respect of calendar year 1999.

For the fiscal year ended March 3, 2001, revenues rose 9 percent to of $14.5 billion. Net loss from continuing operations before an accounting change increased 44 percent to $1.62 billion. These results reflect strong same-store sales, offset by interest expenses and loss on investment, according to the company.

Included in the fiscal 2001 net loss from continuing operations were non-cash charges of $645.8 million. That included $415.3 million for store closings and impairment, $100.6 million related to debt for equity exchanges, $48.9 million for stock-based compensation, a $40.7 million LIFO charge on inventory and $36.7 million, for the company’s share of drugstore.com’s losses.

Rite Aid is currently being investigated by the U.S. Securities and Exchange Commission and federal prosecutors in regard to its accounting practices.

Rite Aid’s stock fell as low as $1.75 at year-end, but it has since rebounded to $8.81