Horton Execs Get $1.6 Million Bonuses

The top two executives at homebuilder D.R. Horton Inc. received bonuses of nearly $1.6 million each even though the company suffered heavy losses in the worst housing downturn in many years, according to a regulatory filing made Wednesday.

Investors have shared in the company's pain, as Horton shares recently fell to their lowest level in five years.

The bonuses made up most of the compensation paid to Chairman Donald R. Horton and Chief Executive Donald J. Tomnitz during the company's fiscal year, which ended Sept. 30.

Horton, 57, was paid the bonus of $1.59 million, a $400,000 salary, got $32,611 in above-market earnings on deferred pay, and $46,750 in other compensation, according to the filing.

Tomnitz, 59, got the same bonus amount, $300,000 in salary, $23,582 in above-market deferred pay earnings and $46,750 in other compensation, the company said.

The company indicated in the Securities and Exchange Commission filing that the bonuses were largely based on a percentage of the company's pretax income, but also included cash flow generation and other steps by the executives that "contribute to stockholder value."

The board's compensation committee didn't weight individual factors, but believed its formula was appropriate for "motivating our executives in an uncertain market."

Horton lost $712.5 million in the fiscal year, as it cut inventory and wrote down the value of assets in the face of a declining housing market.

The Associated Press calculations of executive pay include salary, bonus, incentives, perquisites, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year.

In the filing, the company placed a value on options for Horton and Tomnitz that vested in fiscal 2007. Since those options were granted in prior years, the AP did not include their value in its calculations of executive pay for the past year.

D.R. Horton's loss in fiscal 2007 compared to a profit of $1.23 billion the year before. Revenue tumbled 26 percent, and Horton _ like other builders _ took big write-downs to reflect to falling value of its holdings and land options.

Tomnitz famously previewed the rest of the year back in March, when he told investors, "I don't want to be too sophisticated here, but '07 is going to suck, all 12 months of the calendar year."

The company cut 2,500 jobs during the year _ 29 percent of its work force, which had dwindled to 6,231 by Sept. 30.

Horton shares fell 20 cents, to $13.21 in midday trading. They have traded in a 52-week range from the March peak of $31.13 to a low of $10.15 in late November.

Donald Horton controls more than 27 million shares, or 8.6 percent of the company's common stock, and trusts that he set up for his children control another 3.3 percent.