Apollo Group Inc., parent of the for-profit University of Phoenix, rewarded several top executives with multimillion-dollar pay packages last fiscal year, according to a securities filing Tuesday.
The highest-paid executive of the Phoenix-based company was co-CEO Charles Edelstein, with $11.3 million in total compensation, Apollo said in its annual proxy statement. Co-CEO Greg Cappelli was the second-highest paid at $7.3 million, followed by Joe D’Amico, president and chief operating officer, at $6.5 million.
The total compensation of John Sperling, Apollo founder and executive board chairman, was $6.4 million, excluding stock-option exercises. Three other executives listed in the proxy had total compensation of $1.3 million to $3.2 million.
Apollo, which operates the country’s largest private university, reported strong financial results for the fiscal year that ended Aug. 31. Revenue surged 26.5 percent, to $4 billion, on a big jump in enrollment. The company reported net income of $598.3 million, up from $476.5 million in fiscal 2008.
The bulk of each executives’ pay package was in the projected value of stock grants and options, which vest over time.
Edelstein’s $11.3 million for example, breaks down this way: salary of $600,000; incentive plan bonus of $1.2 million; $3.3 million in restricted stock units; and $6.2 million in option grants.
Cappelli and Edelstein were named co-CEOs in April. Edelstein joined the company in August 2008 as CEO, Cappelli as an executive vice president in 2007. Both previously were with the investment-banking firm Credit Suisse.
The difference in their pay packages for 2009 is due to the timing of their employment agreements and large, initial option grants.
Cappelli’s total compensation was $11.6 million in fiscal 2008, with the largest piece being $10.1 million in stock options. Edelstein’s, in comparison, was $339,506 because he joined the company as that fiscal year was ending.
The Republic excludes the future value of stock options and grants in its annual survey of the highest-paid executives of publicly traded Arizona companies. It does include gains on stock options exercised during the fiscal year, which is the difference between the option price and the price at which the executives sold the shares.
Sperling will rank high next year. His stock-option gains totaled $38 million. D’Amico’s gains were $4.9 million. Neither Edelstein nor Cappelli exercised options.