DreamWorks CEO Jeffrey Katzenberg Takes 53% Pay Hit in 2014

Jeffrey Katzenberg DreamWorks
Imeh Akpanudosen/Getty

DreamWorks Animation chief executive officer Jeffrey Katzenberg took a more than $7 million pay hit in 2014 — his annual compensation reduced about 53% from $13.5 million to $6.4 million — as a result of toon makers’ poor performance over the year, an official filing shows.

Katzenberg got $6 million in incentive pay in 2013 and no such added compensation last year, according to the SEC filing, which reflects the company’s substantial losses. DreamWorks reported a $103 million loss in adjusted operating income in 2014.

Other DreamWorks executives also took substantial hits in 2014, with company president Ann Daly’s total compensation dropping from more than $8 million to $4.1 million over the previous year, and chief global brands officer Michael Francis dipping from nearly $6.1 million to just over $3.2 million. Both got substantial incentive cash in 2013 — $3 million for Daly and $2.4 million for Francis — that disappeared in troubled 2014.

New Chief Financial Officer Fazal Merchant made nearly $2.5 million in his first year at DreamWorks, while outgoing CFO Mark Zoradi collected more than $2 million. The filing showed that former Vice Chairman Lewis Coleman collected more than $3.4 million — the only one of the top officers whose pay increased.

DreamWorks had suffered with several under-performing films and has only one release in this year, causing skepticism about the company’s future. The media interest received a bit of a reprieve with the late March release of “Home,” which has earned more than $243 million at the worldwide box office, on an estimated budget of $135 million.

Katzenberg has said the company will go back to its roots and that — after years of focusing on the company’s TV operations and adjunct businesses — he intends to devote more of his time to the core movie business in 2015. The company announced in January that it would reduce its slate from three films a year to two and cut costs substantially. DreamWorks subsequently sold, then leased back, its Burbank campus to raise cash.  The company’s creative chief, Bill Damaschke, also moved on and was replaced by co-presidents of Feature Animation, Bonnie Arnold and Mireille Soria.

The SEC filing, in preparation for the company’s annual shareholders meeting on May 26, showed that DreamWorks founder Katzenberg’s base pay remained unchanged at $2.5 million. To get the maximum possible bonus of $4 million, however, the company would have had to make 150% of its profit target of $61.5 million for the year. It didn’t come close.

Daly’s base pay also remained unchanged at $1.5 million, while Francis’s crept up from just under $1.1 million to $1.2 million.

Recent dreary results also took away from long-term performance awards for some top executives. Both Daly and  Coleman stood to get substantial long-term compensation first granted by the Dreamworks board in 2011. But the negative cash flow wiped out those potential gains.

The compensation committee of the DreamWorks board said that its decisions on pay were meant to align the interests of executives with those of shareholders. It also said it follows a provision that “no bonuses would be paid to the named executive officers if bonuses were not paid under the Company bonus plan applicable to other employees.”

DreamWorks executives still face a significant upside, if they can reverse the company’s fortunes. Stock grants approved by the board in February would give the execs stock awards of considerable value: for Katenberg, nearly $3.4 million, Daly $2.6 million, Francis $1.7 million and Merchant $900,000.

Those awards will be forthcoming if the company meets a minimum threshold: It must be profitable at the end of 2015 and 2016, the SEC filing said.

DreamWorks stock, which had dropped at one point to just over $18 a share, has rebounded since the release of “Home.” On Monday, shares closed Wednesday at $25.77, up 63 cents.

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  1. ObserverMI says:

    Oops… wrong page.

    Should have read…. “wow… how’s he gonna get by??”

  2. Brent says:

    If you get so offended by political opinions, don’t bother going on the internet. Katzenberg is a topic where that will occur.

  3. IT 2 IT says:

    Franchise slum Hoillywood have had us staring at the same
    string of ‘CALM–ICKs’ for 4 decades now.

    Began with the RED CHINA handover op of the 70s.

    Everyone running Hollywood is ‘on board’.

    BEWARE

  4. Brent says:

    I guess that’s what he gets for wasting time with the Obamafia and giving millions to them and not focusing on making decent movies. No wonder he’s not a billionaire.

    • G. Henry says:

      You sir are an ass for that remark but darn, you already knew that. I’ll try to be faster next time. Ok?

      • Brent says:

        Oh that really hurt. Not! You are just offended that I made a negative comment about Obama. What? How about you quit calling people stupid names and grow up?

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