Todd Vance
Builders FirstSourceAbout Todd Vance
Todd Vance, age 60, was appointed President – East Division at Builders FirstSource (BLDR) in March 2025 after leading the Mid-Atlantic region since 2015; he has 35+ years of industry experience, including earlier leadership roles within BLDR’s legacy companies and an early career at Lowe’s Companies starting in 1982 . Company performance context during the latest year disclosed: Adjusted EBITDA was $2.33B (vs. a $2.8B AOP target), ROIC was 20.7%, and BLDR’s TSR index value stood at 562.50, with operational achievements including 50% of sales from value‑added products and a recordable injury rate (RIR) improvement to 1.39 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Builders FirstSource | President – East Division | Appointed March 2025 | Oversees East Division operations |
| Builders FirstSource | SVP – Mid-Atlantic Region | 2015–2025 | Regional leadership across Mid-Atlantic markets |
| Builders FirstSource | Area President | 2007–2015 | Led multiyear regional operating performance |
| Builders FirstSource | Market Manager | 2003–2007 | Local market leadership; execution and growth |
| Builders’ Supply & Lumber Co. (legacy BLDR) | Progressive roles incl. General Manager | 1988–2003 | Led expansion into the Charlotte, NC market |
| Lowe’s Companies | Early career roles | Began 1982 | Foundation in building products retail operations |
Fixed Compensation
- Vance-specific base salary, target bonus, and 2024 bonus were not disclosed in the 2025 proxy (he was appointed in March 2025 and was not a 2024 NEO) .
- Company framework for executive base salaries: determined by role/responsibility, peer benchmarks, and internal equity; 2024 examples for NEOs show salary adjustments reflecting promotions and market moves (illustrative of policy) .
Performance Compensation
BLDR’s design relies on an annual cash incentive plan and multi‑year equity with ROIC targets and a TSR modifier; the following tables illustrate the disclosed metrics and mechanics for 2024 (company program; Vance-specific payouts not disclosed).
- 2024 Corporate Annual Incentive Plan (illustrative metrics, weightings, targets, achievements, and payout mechanics)
| Metric | Weighting | Threshold | Target | Maximum | Achievement | Payout (% of Total Target Amount) |
|---|---|---|---|---|---|---|
| Corporate Adjusted EBITDA | 70% | $2.24B | $2.8B | $3.36B+ | $2.33B | 28.7% for corporate NEOs; 31.6% for divisional NEO (West) |
| Working Capital as % of Sales | 15% | 10.2% | 9.5% | 6.8% or below | 9.0% | 19.2% |
| Safety (RIR) | 5% | 1.54 | 1.39 | 1.24 | 1.39 | 5.1% for corporate NEOs; 0% for West Division NEO |
| Safety Training | 5% | 85% | 90% | 100% | 99.9% | 10.0% |
| Respectful & Inclusive Culture (RIC) Training | 5% | 85% | 90% | 100% | 99.9% | 10.0% |
- 2024 Long‑Term Incentive Plan (PSUs and RSUs)
- RSUs: time‑based vesting, generally in three equal annual installments (retention‑focused) .
- PSUs: vest on the third anniversary based on annual and three‑year ROIC goals with a +/-10% TSR modifier vs. the Dow Jones U.S. Construction & Materials Index; tranches and weights below (company template) .
| PSU Measurement Tranche | Weight |
|---|---|
| Year 1 ROIC (annual) | 25% |
| Year 2 ROIC (annual) | 25% |
| Year 3 ROIC (annual) | 25% |
| 3‑Year Average ROIC | 25% |
- 2024 company performance context and resulting bonus outcomes (illustrative for design efficacy): Corporate NEOs earned ~73% of target; the divisional NEO (West) earned ~70.8% due to divisional performance nuances .
Equity Ownership & Alignment
- Section 16 status: Todd Vance filed a Power of Attorney to enable Forms 3/4/5 and Rule 144 filings (dated March 31, 2025; filed April 4, 2025), indicating officer reporting obligations; monitor subsequent Forms 3/4 for grants/transactions .
- Stock ownership guidelines: Executive officers are expected to hold stock equal to 3x base salary; unvested RSUs count; until compliant, executives must retain 50% of net shares from company equity settlements .
- Anti‑hedging/anti‑pledging: Directors and executive officers may not hedge or pledge BLDR stock without prior written approval of the General Counsel; short sales/options and margin accounts are restricted without approval .
- Compliance oversight: The Compensation Committee reviewed ownership compliance in Oct 2024 and found all directors and executive officers either compliant or within the grace period .
Stock ownership guideline requirements (company policy):
| Position | Holding Requirement |
|---|---|
| CEO | 5x base salary |
| Executive Officers | 3x base salary |
| Directors | 5x annual cash retainer (excl. chair/committee retainers) |
Employment Terms
- Severance Plan (adopted Feb 2023): Applies to designated executives and key employees; Regular severance (non‑CIC) includes pro‑rata annual bonus (based on full‑year actuals), cash severance of 2.0x (Tier I) or 1.5x (Tier II) base salary + target bonus, plus continuation value of health benefits for 24 months (Tier I) or 18 months (Tier II); pro‑rata vesting of time‑ and performance‑based equity tied to actual performance .
- Restrictive covenants (as condition for plan participation): Non‑compete, customer non‑solicit, and employee non‑recruit provisions for 24 months (Tier I) or 18 months (Tier II) post‑termination, subject to state law limits .
- Change in Control and acceleration: Award agreements provide for acceleration of all unvested RSUs and PSUs upon a change in control; death or disability also accelerates RSUs and preserves PSU vesting at the stated vest date as if continuously employed .
- Clawback: Dodd‑Frank/NYSE‑compliant compensation recoupment policy adopted Dec 1, 2023 requires recovery of overpaid performance‑based incentives to executive officers for the three completed fiscal years preceding any financial restatement .
Performance & Company Context (latest disclosures)
| Metric | 2024 Result |
|---|---|
| Adjusted EBITDA | $2.33B (vs. $2.8B AOP target) |
| Working Capital as % of Sales | 9.0% (vs. 9.5% target) |
| ROIC | 20.7% |
| TSR (Value of $100 Investment) | 562.50 (vs. peer group 225.97) |
| Value‑Added Products Mix | 50% of net sales |
| Installed Sales Revenue | $2.7B (~16% of revenue; +8% y/y) |
| Productivity Savings | $117M |
| Share Repurchases | 8.9M shares at $170.74 avg. for ~$1.5B |
| Safety – RIR | 1.39 (10% improvement) |
| RIC/Safety Training | 99.9% completion |
Governance, Peer Benchmarking, and Say‑on‑Pay
- Compensation Committee (independent; 3 members; 5 meetings in 2024) oversees CEO/NEO pay, clawback policy, stock ownership guidelines, succession planning, and human capital matters .
- 2024 compensation peer group includes large‑cap industrials/distributors (e.g., Owens Corning, WESCO, Grainger, Sherwin‑Williams, Trane) to benchmark total direct compensation .
- Say‑on‑Pay approval: Nearly 95% support at the June 4, 2024 annual meeting; Committee kept program largely consistent in 2024 .
Investment Implications
- Alignment and retention: Vance is a long‑tenured operator promoted to run BLDR’s East Division, with deep internal experience and a track record that includes leading the Charlotte market expansion—positive for continuity and execution in a cyclical category .
- Incentive design levers: Company incentives emphasize ROIC, working capital discipline, and safety/training; 2024 payouts at ~70–73% of target indicate sensitivity to under‑target EBITDA while rewarding cash/operational discipline—expect Vance’s incentives to mirror this structure going forward (monitor his next proxy/Form 4s for specifics) .
- Trading/overhang watchlist: Vance became a Section 16 reporting person in April 2025 (POA filed), so forthcoming Forms 3/4 will clarify initial holdings, grants, vesting cadence, and any selling—key to assessing near‑term selling pressure and alignment .
- Risk controls: Anti‑hedging/pledging restrictions, ownership guidelines with retention requirements, and a restatement clawback mitigate misalignment; severance plan includes non‑compete up to 24 months, reducing near‑term retention risk if terms apply to Vance (designation not disclosed) .
- Change‑in‑control dynamics: Award agreements state full acceleration on a change in control, which can concentrate vesting and create potential event‑driven supply; continue to scrutinize the definitive award terms for executives appointed in 2025 to confirm treatment .
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