Royal KPN Cuts Eelco Blok’s Compensation as Shares Slump 60%Maaike Noordhuis
Royal KPN NV, the Dutch carrier partly owned by Carlos Slim’s America Movil SAB, cut compensation for its Chief Executive Officer Eelco Blok by one quarter after he presided over a 60 percent drop in the company’s share price in the past year.
Blok’s long term incentive based on performance shares dropped to 269,800 euros ($352,800) last year from 1.09 million euros in 2011, the Hague-based company said today in its annual report. The long term incentive plan awards shares for above average returns, while no shares are rewarded for below average performance, said the report published on KPN’s website.
Blok, who became CEO in April 2011, had total compensation, including a cash bonus, pension costs and other items cut to 1.64 million euros from 2.17 million euros.
KPN attempted unsuccessfully to defend itself last year against a 2.6 billion-euro offer from America Movil for a stake in the company and failed to sell its Belgian mobile-phone unit Base. The company also ended discussions on a potential merger involving its E-Plus wireless unit in Germany.
KPN spent 1.35 billion euros in the fourth quarter on spectrum for faster mobile networks, undermining its debt-to-equity ratio. The former Dutch phone monopoly said on Feb. 5 it will sell 4 billion euros in shares to help prop up its finances.
The company reported a fourth-quarter loss of 162 million euros compared with a profit of 176 million euros a year earlier. Revenue and other income fell 3 percent to 3.27 billion euros, partly reflecting falling sales in the Netherlands.
KPN shares slump in the past year marked the worst performance in the 25-company Europe Telecommunications Services Index. The stock fell 1.8 percent to 2.68 euros at 11 a.m. in Amsterdam, giving the company a market value of 3.8 billion euros.