Pepco gave its chairman higher pay than BGE did Compensation is also unusual with respect to size of the utility

October 15, 1995|By Kevin L. McQuaid | Kevin L. McQuaid,SUN STAFF

The Potomac Electric Power Co.'s chairman and chief executive officer was paid 14 percent more than the top executive of the Baltimore Gas and Electric Co. in 1994 despite a dip in its earnings.

While not out of line with other top utility executives, Pepco Chairman and Chief Executive Edward F. Mitchell's compensation of nearly $100,000 more than his BGE counterpart, Christian H. Poindexter, also is unusual in the industry, considering the Washington-based utility's size relative to BGE.

Pepco is roughly $1 billion smaller than BGE in terms of market capitalization and assets, and BGE's service territory is also vastly greater than its competitor to the southwest.

Additionally, Mr. Mitchell's $787,417 total compensation last year outpaced Mr. Poindexter's even though the Pepco executive failed to receive any bonus, presumably because the company had a 6 percent earnings drop in 1994, according to PEPCO's most recent proxy statement and annual report.

The year before, when earnings were slightly better, Mr. Mitchell's compensation totaled nearly $878,000, thanks in part to a $218,700 bonus.

The differences in compensation will become significant as the two utilities move toward their anticipated March 1997 merger. As part of the consolidation -- in which Mr. Mitchell will serve as chairman for one year until Mr. Poindexter will hold both the chairman and CEO posts -- a financial compensation plan incorporating executive pay scales at both companies is expected to be adopted.

Mr. Mitchell's base salary of $553,333 in 1994 was augmented by $234,084 in earnings from company-owned life insurance policies, nonvested stock and company-funded savings plans.

Mr. Poindexter, by contrast, received $687,969 from BGE, reflecting a base salary of $498,533, plus a $163,000 bonus. Only 4 percent of his pay derived from company savings or life insurance contributions.

But on the presidential level at the two companies, BGE's is the better paid. Its president and COO, Edward A. Crooke, was paid $529,156 in 1994, in excess of 20 percent more than his Pepco counterpart. Mr. Crooke's total package included a $125,000 bonus. Again, other compensation accounted for just 4 percent of his total.

Pepco's President and Chief Operating Officer John M. Derrick Jr.'s total package amounted to $422,523 last year, included $89,190 on top of his salary for other benefits. Like his boss at Pepco, Mr. Derrick did not get a bonus.

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