R. Steve Kinsey
FLOWERS FOODSAbout R. Steve Kinsey
Flowers Foods’ long-tenured Chief Financial Officer (CFO), R. Steve Kinsey, plans to retire at year-end 2025 after 36 years at the company, including the last 18 years as CFO; he is expected to serve in an advisory role post-retirement to support the transition . As CFO, Kinsey’s remit spans finance, treasury, IR, accounting, tax, internal audit, risk, procurement, and information security . Company performance under his tenure in 2024: net sales $5.103B, net income $248.1M, adjusted EBITDA $538.5M, adjusted EPS $1.28; the company’s TSR index stood at 112.71 vs. peer group 113.91 for 2024, and say‑on‑pay support exceeded 98% in 2024 . Education and age are not disclosed in the proxy/8‑K filings.
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Flowers Foods, Inc. | Chief Financial Officer | 18 years | Long-serving CFO; guided finance functions across treasury, IR, accounting, tax, internal audit, risk, procurement, information security . |
| Flowers Foods, Inc. | Advisor post-retirement | 2026 expected | Advisory role to ensure smooth CFO transition following retirement at year-end 2025 . |
External Roles
No public external directorships or roles for Kinsey are disclosed in the proxy or 8‑K filings.
Fixed Compensation
| Element | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | $632,787 | $665,025 | $700,000 |
| Base Salary Rate at Fiscal Year End ($) | — | $700,000 | $700,000 |
| Target Annual Incentive (% of Base) | — | — | 80% |
| Actual Annual Incentive Paid ($) | $325,689 | $301,132 | $540,960 (96.6% payout vs. target) |
| Employer Contributions to 401(k) + EDCP ($) | $120,908 | $108,309 | $94,283 |
| Above‑Market EDCP Earnings ($) | $31,974 | $30,764 | $29,011 |
Notes:
- 2024 annual incentive program weighted 70% adjusted EBITDA and 30% net revenue with final payout 96.6%; adjusted EBITDA target $541M (actual $539M) and net revenue target $5.15B (actual $5.10B) .
- EDCP credits earn Merrill Lynch U.S. Corp BBB 15-year index +150 bps; EDCP aggregate year-end 2024 balance for Kinsey was $1,810,757 .
Performance Compensation
Annual Cash Incentive (FY 2024)
| Metric | Weighting | Target | Actual | Payout % | Weighted Payout % |
|---|---|---|---|---|---|
| Adjusted EBITDA | 70% | $541M | $539M | 97.9% | 68.53% |
| Net Revenue | 30% | $5.15B | $5.10B | 93.4% | 28.02% |
| Final Payout | — | — | — | — | 96.6% |
Long‑Term Incentives (granted December 31, 2023 for FY 2024 cycle)
| Award Type | Target # Shares | Vesting / Performance Window | Payout Scale |
|---|---|---|---|
| ROIC‑based Performance Shares | 19,080 (Kinsey) | Performance period Dec 31, 2023–Jan 2, 2027; vest after 2026 10‑K filing, no later than Mar 15, 2027 | ROIC–WACC: <150 bps = 0%; 150 bps = 50%; 300 bps = 100%; ≥450 bps = 150%; linear interpolation |
| TSR‑based Performance Shares | 19,080 (Kinsey) | Performance period Jan 1, 2024–Dec 31, 2026; vest after 2026 10‑K filing | Relative TSR percentile vs. 16‑company peer group: <30th = 0%; 30th = 50%; 50th = 100%; 70th = 150%; ≥90th = 200%; averaged across final four quarters (12.5% overall threshold) |
| Time‑based RSUs | 16,360 (Kinsey) | Vest in equal thirds on first three anniversaries of grant | Time‑based vesting; dividends accrue and pay on vest |
Additional details:
- 2024 LTI mix: 70% PSUs (50% ROIC, 50% TSR), 30% RSUs; retirement definition updated (≥55 years old and age+service ≥65; generally requires 6 months’ notice) .
- 2022 PSU outcomes: ROIC PSUs vested at 125% (ROIC–WACC exceeded by 611 bps); TSR PSUs vested at 13.25% based on relative TSR percentiles across 2024 quarters .
Grant values (ASC 718):
| Element | FY 2024 Grant Date Fair Value ($) |
|---|---|
| ROIC PSUs (Kinsey) | $429,491 |
| TSR PSUs (Kinsey) | $497,338 |
| RSUs (Kinsey) | $368,264 |
| Total Target LTI Value (Kinsey) | $1,295,000 (9.8% YoY increase) |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 483,736 shares as of March 6, 2025; less than 1% of class . |
| Outstanding Equity (12/28/2024) | Unvested RSUs: 16,360 ($334,889 MV); Unearned PSUs: 2024 ROIC 28,620 ($585,851 MV), 2024 TSR 38,160 ($781,135 MV); plus 2023 PSUs and 2022 PSU tranches as listed in the table . |
| Options | No stock options outstanding; immediate vest applies to “currently there are none” if death/disability . |
| Dividends on Awards | Dividends accrue and are paid in cash upon vesting for PSUs and RSUs . |
| Stock Ownership Guidelines | CFO required to hold 3x base salary; executives must retain 75% of net shares until guidelines met; all NEOs are compliant, on track, or waived by committee . |
| Anti‑hedging / Pledging | Anti‑hedging policy in place; pledging not specifically disclosed . |
Employment Terms
- Employment agreements: None; the program avoids employment agreements and significant perquisites .
- Change‑of‑Control Plan (double‑trigger): CFO receives 2x base salary plus 2x target annual bonus upon qualifying termination in connection with a change of control; also 18 months of medical premiums and up to $25,000 outplacement; “best‑net” cutback to avoid excise tax if applicable .
- Equity treatment at CoC/Separation: Double‑trigger vesting for equity; ROIC/TSR PSUs vest at target (or actual TSR if ≥12 months elapsed) on qualifying CoC termination; RSUs fully vest for Thomas under specified grant; death/disability: PSUs vest at target; RSUs vest; retirement: PSUs vest prorata at normal vest date based on actual performance; RSUs vest in full if retirement ≥1 year after grant .
- Restrictive covenants: One‑year non‑compete post‑CoC; two‑year non‑solicit; perpetual non‑disclosure/non‑disparagement .
- Clawbacks: NYSE/SEC‑compliant mandatory clawback for restatement‑related excess incentive compensation (3‑year window); supplemental discretionary clawback for detrimental activity or inaccurate data, including pre‑Oct 2, 2023 awards .
- Insider trading policy: Anti‑hedging; policy oversees trading and compliance .
- Related party transactions: Kinsey’s son‑in‑law (Associate General Counsel I) received $171,781 total compensation in 2024; reviewed and approved by full board per policy; not an executive officer .
- Retirement transition: Kinsey to retire Dec 31, 2025, with advisory role to support CFO transition; successor named effective Jan 1, 2026 (D. Anthony Scaglione) .
Compensation Structure Analysis
- Mix shift and market alignment: Kinsey’s target LTI value increased 9.8% in 2024 to $1.295M, with a new mix adding 30% RSUs alongside 70% PSUs—this increases certainty of value and retention, while preserving pay‑for‑performance via ROIC/TSR PSUs .
- Annual bonus rigor: 2024 adjusted EBITDA scale widened to market norms; payout tied 70% to adjusted EBITDA and 30% to net revenue, resulting in a 96.6% payout despite slight under‑target results (EBITDA $539M vs $541M target; revenue $5.10B vs $5.15B target) .
- Long‑term performance discipline: 2022 PSU outcomes bifurcated—strong ROIC outperformance (611 bps over WACC) paid 125%, while TSR underperformed peers (13.25% payout), indicating balanced metrics and no undue windfalls .
- Governance safeguards: No employment agreements, no excise/gross‑up, double‑trigger CoC vesting, robust clawbacks, anti‑hedging, and ownership/retention requirements .
Multi‑Year Compensation (Summary Table)
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Salary ($) | $632,787 | $665,025 | $700,000 |
| Stock Awards ($) | $1,145,409 | $1,179,827 | $1,295,093 |
| Non‑Equity Incentive Plan ($) | $325,689 | $301,132 | $540,960 |
| Above‑Market EDCP Earnings ($) | $31,974 | $30,764 | $29,011 |
| All Other Compensation ($) | $120,908 | $108,309 | $94,283 |
| Total ($) | $2,256,767 | $2,285,058 | $2,659,347 |
Equity Ownership & Outstanding Awards (selected)
| Item | As of Date | Amount |
|---|---|---|
| Beneficial ownership (common) | Mar 6, 2025 | 483,736 shares; <1% |
| Unvested RSUs | Dec 28, 2024 | 16,360; $334,889 MV |
| Unearned 2024 ROIC PSUs (max reported) | Dec 28, 2024 | 28,620; $585,851 MV |
| Unearned 2024 TSR PSUs (max reported) | Dec 28, 2024 | 38,160; $781,135 MV |
Employment Terms (CIC & Separation Economics Summary)
| Provision | CFO Terms |
|---|---|
| CIC cash multiple | 2x base + 2x target annual cash incentive |
| Health/outplacement | 18× monthly premiums; up to $25,000 outplacement |
| Equity on CIC termination | PSUs at target (TSR actual if ≥12 months elapsed); RSU accelerated under plan terms |
| Covenants | 1‑year non‑compete; 2‑year non‑solicit; perpetual NDA/non‑disparagement |
| Clawbacks | NYSE/SEC mandatory (restatements); supplemental discretionary (detrimental activity/inaccurate data) |
| Ownership guidelines | 3x salary; 75% net shares retention until met; compliant/on track/waived |
| Employment agreements | None; no income tax/excise gross‑ups |
Performance & Track Record
| Metric | FY 2023 | FY 2024 |
|---|---|---|
| Net Sales ($B) | $5.091 | $5.103 |
| Adjusted EBITDA ($M) | $501.7 | $538.5 |
| TSR index ($100 base) | 118.91 | 112.71 |
| Peer TSR index ($100 base) | 119.68 | 113.91 |
Say‑on‑pay approval exceeded 98% in 2024, indicating strong shareholder support for pay design and outcomes .
Risk Indicators & Red Flags
- Related party: Kinsey’s son‑in‑law compensated $171,781 in 2024 as Associate General Counsel I; reviewed/approved by board; not an executive officer .
- Section 16 reporting: One late Form 4 in January 2025 (administrative error) among several executives including Kinsey; company disclosed and corrected .
- Hedging/Pledging: Anti‑hedging policy; pledging policy not specifically disclosed .
- Options repricing/gross‑ups: None; no excise tax gross‑ups; no option repricing/backdating .
Compensation Peer Group & Benchmarking
- The company uses survey data (Willis Towers Watson Executive Compensation Database) across agriculture/food/beverage and general industry, size‑adjusted to Flowers’ revenue scale; individual pay positioned around size‑adjusted 50th percentile, with committee/consultant oversight .
- Target pay opportunities reflect market alignment; Kinsey’s 2024 target LTI value increased 9.8% YoY .
Say‑on‑Pay & Shareholder Feedback
- 2024 Say‑on‑Pay: >98% approval; company continued similar principles thereafter .
- 2025 shareholder proposal for independent board chair opposed by board; independent presiding director role described; not directly related to Kinsey’s role .
Expertise & Qualifications
- Role scope reflects seasoned finance leadership; formal educational details for Kinsey not disclosed in proxy/8‑Ks.
- Kinsey’s advisory role post‑retirement underscores transition stewardship .
Equity Ownership Guidelines Compliance
- CFO guideline: 3x salary; executives must retain 75% of net shares until met; committee reports NEOs are compliant/on‑track/waived .
Investment Implications
- Alignment: High pay‑for‑performance integrity—annual bonus tied to EBITDA/revenue, PSUs split ROIC/TSR with disciplined scales; lack of employment agreements and robust clawbacks reduce governance risk .
- Retention/transition: Kinsey’s planned retirement and advisory role mitigate transition risk; successor CFO appointed with clear compensation structure, supporting continuity .
- Vesting/supply dynamics: Retirement eligibility can accelerate RSU vesting (if ≥1 year post‑grant) and prorate PSU vesting at normal vest date—monitor award deliveries around the transition for potential incremental share supply; double‑trigger required for CIC acceleration .
- Performance drivers: ROIC outperformance vs. WACC drove 2022 PSU gains, while TSR underperformance constrained payouts—current design balances internal returns and market relative performance, supportive of disciplined capital allocation and shareholder returns .