Beazer Homes Rewards Top Execs Ian McCarthy, Michael Furlow, Allan Merrill With Bonuses Totalling $1.4 Million, While Losses Top 131 Percent

While the housing market has literally collapsed and many homebuilders are going out of business, Beazer Homes has rewarded its executives handily despite mounting losses. It is really unconscionable that after a year in which the company's losses topped 131 percent to more than $951 million, the company doled out $1.4 million in bonuses to its top three executives.

Ian McCarthy, CEO of the struggling Atlanta-based builder, received a $600,000 bonus. McCarthy’s base pay is $1.2 million.

Executive Vice President and Chief Operating Officer Michael Furlow was awarded $400,000, 50 percent of his base pay.

And Executive Vice President and Chief Financial Officer Allan Merrill received $400,000. Merrill’s base pay is $600,000.

“These awards were appropriate in light of the importance of having met the performance targets and the need to continue to motivate our executives by tying compensation to individual performance,” Beazer says in a Securities and Exchange Commission filing. Merrill’s bonus includes $100,000 “in light of his efforts in completing a restatement of the company’s financial statements.” In May, Beazer released several periods of restated earnings after an internal investigation found “accounting errors and irregularities.”

The bonuses were for fiscal year 2008, which ended Sept. 30. During those 12 months, Beazer’s losses grew from $411.1 million to $951.9 million. Its stock price fell 27 percent to less than $6.

Low consumer confidence, falling prices, high levels of unsold homes and more restrictive lending are all hurting home sales, Beazer says. Completed sales contracts plummeted 38 percent compared to fiscal year 2007. Source: Atlanta Journal Constitution

Let's not forget that this is the same company currently under investigation following complaints about an inordinate number of foreclosures in the Charlotte area. Seems like their priorities are misguided to me. The company said that it is working to cut its expenses and inventory, as well as boosting its cash position. The company, according to the Atlanta Journal Constitution, now employs about 1,400 people after cutting its workforce by 45 percent, or 1,175 employees, in fiscal year 2008. So, the workers suffer while the top executives hit pay dirt for the holidays. The middle class gets crapped on while the top executives get richer.