Viacom has signed Philippe Dauman to a new long-term contract, securing the services of its president and CEO through December 2016.
Dauman’s previous employment agreement was set to expire at the end of 2011. In a statement released Thursday, Viacom credited Dauman’s “strong operational and financial leadership” as a determining factor in the decision to offer him a new contract.
A longtime confidant of Viacom executive chairman Sumner Redstone, Dauman officially began punching the clock in 1993, when he joined the company as chief counsel and a deputy chairman. He was named president and CEO of Viacom in September 2006, following the ouster of MTV founder Tom Freston.
Despite a severe downturn in the advertising market, Viacom was able to gut out the most severe recession in decades. In 2009, the company saw operating income increase 15 percent to $2.9 billion, on a 7 percent decline in overall sales. Viacom last year took in $13.6 billion in consolidated revenue, down from $14.6 billion in 2008.
Viacom is particularly exposed to the vicissitudes of the ad market, as its media networks account for some 60 percent of its total revenue haul. In 2009, MTV Networks and BET Networks took in $4.41 billion in ad sales dollars, a decline of 7 percent versus the year-ago $4.72 billion.
Affiliate fees help offset losses on the sponsor side of the ledger; in 2009, the media networks group boosted carriage dollars 11 percent to $2.9 billion.
Always effusive in his praise of Dauman, Redstone in February told investors his consigliere’s accomplishments “far exceeded my expectations,” adding that he was “particularly proud of how Philippe demonstrated financial foresight, operational discipline and creative energy” during the economic crisis.
While terms of Dauman’s new contract aren’t likely to be disclosed until April 29, when Viacom reports its Q1 ‘10 earnings, the bulk of his compensation will continue to be tied to performance. According to a document filed with the Securities and Exchange Commission, Dauman’s total cash compensation in 2008 was $10.4 million. His base salary accounted for less than a quarter of that sum.
Along with $7.83 billion in target bonuses, Dauman raked in another $13 million in stock awards and options. All told, he earned in excess of $23 million in 2008.
Shares of Viacom have nearly doubled in the past year. In early afternoon trading, the stock was moving at $39.50, up 87 percent from $21.19.