Community Health Systems CEO Wayne Smith received no raise in base salary for 2016 after the hospital chain missed most earnings and stock price targets in 2015, the company said in a regulatory filing Thursday.
Smith's base salary will stay at $1.6 million again in 2016, while performance-based restricted stock grants will fall from a value of $9.3 million in 2015 to $2.3 million.
Smith also felt the sting this year from the company's 2015 financial slump when his cash bonus was just $400,000, compared with $4.1 million in 2014, according to the company's proxy statement in preparation for next month's annual shareholder meeting.
Chief Financial Officer W. Larry Cash also gets no increase in base salary in 2016 from the $850,000 he was paid in 2015, the company said.
CHS, the nation's second-largest hospital chain by revenue, reached very few of its financial targets in 2015 as net earnings for the year fell drastically and its stock price plunged from a June 26 high of $64.04 to finish the year at $26.53. It has bounced around below that level in 2016, closing Thursday at $18.63.
Moreover, earnings swung to a loss in the fourth quarter. CHS posted a net loss of $83 million, or 73 cents per share, in its fourth quarter, compared with net income of $100 million, or 88 cents per share, in the prior-year quarter. Revenue in the fourth quarter fell to $4.8 billion from $4.9 billion the year earlier.
Last week CHS announced that on April 29 it will spin off 38 hospitals into an independent company called Quorum Health. CHS said the divestiture of the predominantly small, rural hospitals will allow the company to concentrate on growing in markets surrounding its remaining 160 hospitals.