Bankrupt Spirit Airlines worth less than executives’ 2023 pay
Spirit Airlines, which filed for bankruptcy in November, has given investors a peek into its ongoing reorganization. As part of that process, it filed a financial update with the Securities and Exchange Commission that shows its equity is worth less than the compensation paid to its executives in 2023.
Given that shareholders usually lose the complete value of their holdings while waiting for a bankrupt company’s debtors to get repaid, it’s not surprising that the company said its current equity is worth just $12.6 million. (In Spirit’s last quarterly earnings report before bankruptcy, that figure was $504 million.)
Still, as a sign of how far things have fallen for Spirit — the company’s shares were delisted by the New York Stock Exchange shortly after the bankruptcy filing and now trade among the pink-sheet penny stocks — its equity is now worth less than the $18.3 million in compensation laid out for executives in its most recent annual proxy statement:
- CEO Ted Christie received $6.6 million in salary and bonuses
- Then-CFO Scott Haralson received $3.6 million
- COO John Bendoraitis received $3.1 million
- CCO Matthew Klein received $2.9 million
- CIO Rocky Wiggins received $2.1 million
This equity comparison doesn’t account for the $5.4 million in retention bonuses approved just days before the November bankruptcy filing, including $3.8 million for Christie and $175,000 for new CFO Frederick Cromer, provided they stay with the company in good standing for one year.
The report, which will be the first in a series of monthly fiscal updates, also shows that between the Nov. 18 Chapter 11 filing and Nov. 30, the airline had $351 million in revenue but suffered a $316 million loss, largely due to $290 million in costs attributed to “other expenses.”
