DALLAS (AP) — The CEO of Southwest Airlines received $4 million in compensation for 2012, up 15 percent from the prior year, largely because of bigger stock awards.
The airline said in a regulatory filing on Friday that Kelly, who is also the company's chairman, was paid a salary of $675,000 and a $961,000 bonus last year, both 4 percent increases from 2011.
The bulk of Kelly's compensation was in stock awards, which Southwest valued at $2.25 million on the day they were granted. He also received $129,802 in other compensation including contributions to retirement plans and security around his home.
Southwest said in the filing with the Securities and Exchange Commission that Kelly's salary is below the median for leaders of similar companies. The board granted Kelly stock awards to reflect his "strong performance" and contributions to strategic moves including the integration of AirTran Airways, which Southwest bought in 2011, and modernizing the fleet, the company said.
However, the board also considered the lack of progress in boosting Southwest's return on invested capital — it failed to hit a goal of a 15 percent increase.