Kyle T. Larkin
GRANITE CONSTRUCTIONAbout Kyle T. Larkin
Kyle T. Larkin is President and CEO of Granite Construction (GVA), serving as President since September 2020 and CEO since June 2021. He joined Granite in 1996 and progressed through project and leadership roles; he holds a B.S. in Construction Management from Cal Poly San Luis Obispo and an MBA from the University of Massachusetts Amherst. Age: 53. Under his tenure, Granite’s revenue rose from $3.50B (FY2021) to $4.01B (FY2024), with margin expansion; EBITDA* and EBITDA margin* improved materially, while performance LTIP paid out on above-target TSR and capital efficiency (RONA) metrics , , .
*Values retrieved from S&P Global.
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Granite Construction | EVP & COO | Feb 2020 – Sep 2020 | Day-to-day operations; platform for CEO succession |
| Granite Construction | SVP & Manager, Construction & Materials Ops | 2019 – 2020 | Integrated Construction & Materials oversight |
| Granite Construction | SVP & Group Manager | 2017 – 2019 | Portfolio and margin stewardship |
| Granite Construction | VP & Regional Manager (Nevada) | 2014 – 2017 | Regional P&L leadership |
| Intermountain Slurry Seal (Granite subsidiary) | President | 2011 – 2014 | Subsidiary leadership; materials integration |
| Granite Construction | Manager of Construction (Reno) | 2008 – 2011 | Execution risk management |
| Granite Construction | Chief Estimator | 2004 – 2008 | Bid discipline and project selection |
| Granite Construction | Project Manager/Engineer/Estimator | 1996 – 2003 | Field execution and estimating foundation |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Granite Construction Incorporated | Director | 2021 – present | Employee director; not independent |
| National Asphalt Pavement Association | Board of Directors | 2023 – present | Industry leadership |
| The Beavers | Board of Directors | 2022 – present | Industry builders’ association |
Fixed Compensation
| Component | FY2024 Amount | Notes |
|---|---|---|
| Base salary | $975,000 | 5.4% YoY raise vs. $925,000 in 2023 |
| Time-based RSU service award | $800,000 (14,695 RSUs) | Granted 3/14/2024; vests ratably over 3 years; grant FMV $54.44 |
| All other compensation | $74,086 | 401(k) match $20,700; dividends $18,203; vehicle $12,000; insurance $23,183 |
| CEO Pay Ratio | 50:1 | CEO total comp $7,726,356; median employee $155,402 |
| Say-on-Pay (2023 cycle) | 83% approval | Annual Say-on-Pay; committee retained FW Cook |
Performance Compensation
| Program | Metric | Weight | FY2024 Target | FY2024 Actual / Outcome |
|---|---|---|---|---|
| Annual Incentive Plan (AIP) | Company EBITDA | 80% | Threshold $315.2mm; Target $394.0mm; Max $472.8mm | Actual $374.8mm (88% of target) |
| Annual Incentive Plan (AIP) | Company OCF (% of revenue) | 20% | 4.9% / 7.0% / 9.1% | Actual 12.0% (200% of target) |
| Annual Incentive Plan (AIP) | Safety multiplier (ORIR/DART) | Modifies payout | 90–115% | Actual 111% multiplier |
| AIP payout (Kyle Larkin) | Payout vs target | — | Target $1,170,000 | Paid $1,431,867 (122% of target) |
| LTIP—3-year RONA (2022–2024) | Capital efficiency (avg RONA) | 25% of LTI | Threshold 6.1%; Target 9.1%; Max 12.1% | Actual 11.0%; Payout 164.4%; Larkin RSUs 26,381 |
| LTIP—3-year Relative TSR (2022–2024) | TSR vs Construction peers | 50% of LTI | 25%ile=35% payout; 50%ile=100%; 75%ile=200% | 71st percentile; Payout 182%; Larkin RSUs 58,411 |
| LTIP—3-year Relative TSR (2021–2023) | TSR vs peers | — | 35/50/80%ile curve | 65th percentile; Payout 150%; Larkin RSUs 81,657 |
| LTIP—Time-based RSUs | Service RSUs | 25% of LTI | — | Vests ratably over 3 years; Larkin 2024 grant 14,695 RSUs |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Total beneficial ownership | 162,941 shares as of 2/28/2025 (less than 1%) |
| RSUs vesting within 60 days (Feb 28, 2025) | 102,094 shares included in beneficial ownership footnote |
| Unvested RSUs at 12/31/2024 | 32,952 RSUs; Market value $2,890,220 (price $87.71) |
| Upcoming vesting schedule (selected) | 3/14/2026: 10,749 RSUs; 3/14/2027: 4,928 RSUs |
| 2024 stock vested | 106,286 shares; value realized $5,893,372 |
| Ownership guidelines | CEO 5x salary; counts RSUs; 50% net-share retention until compliance; all NEOs in compliance (as of 12/31/2024) |
| Hedging/pledging | Hedging prohibited; pledging prohibited by Insider Trading Policy |
| Insider trading signals | Reported open-market sale of 22,999 shares on Apr 29, 2025 (GuruFocus tracker) |
Employment Terms
| Provision | Terms |
|---|---|
| Change-in-control (ERSP III) | Double-trigger; 2x base salary, 2x average AIP bonus (prior 3 yrs), 2x average employer retirement contributions, 2x average insurance premiums; accelerated equity per plan; outplacement; no tax gross-ups; payments capped at 280G “safe harbor” |
| Example CIC payout (as of 12/31/2024) | Cash severance $3,433,797; Insurance $39,178; Other comp $37,000; Accelerated equity $21,968,022; Total $25,477,997 |
| Clawback policy | Adopted Oct 2023; restatement-driven recovery of erroneously awarded incentive comp; aligns with SEC/NYSE rules |
| Non-solicit / non-disparagement | Two-year non-solicit; non-disparagement following termination (ERSP III) |
| Deferred comp (NQDC) participation | 2024 exec contribution $16,806; aggregate year-end balance $24,925 |
Board Governance
- Role: Employee director since 2021; not independent. Board Chair is independent (Michael F. McNally), mitigating dual-role concerns; therefore Granite does not have a Lead Independent Director currently .
- Committees: Larkin is not listed on any standing committees (Audit/Compliance, Compensation, Nominating & Governance, Risk) .
- Board attendance: Board held 5 meetings in 2024; all directors attended ≥75% of meetings and the annual meeting .
Director Compensation Context (Board program)
| Retainers | Amount | Equity Grants | Amount |
|---|---|---|---|
| Board member cash retainer | $90,000 | Member annual RSUs | $135,000 |
| Board Chair cash retainer | $175,000 | Chair annual RSUs | $200,000 |
| Committee member/chair fees | $7,500 – $20,000 | RSUs vest annually (May 20); deferral available via NQDC | — |
Performance & Track Record
- Strategic focus: Vertical integration and “best value” (CM/GC, progressive design-build) portfolio growth; record CAP ~$6.3B in Q3’25; 2025 guidance raised for adjusted EBITDA margin to 11.5–12.5% .
- M&A execution: 2022–2025 acquisitions strengthened Materials platform (e.g., Warren Paving, Papich, Cindolite); materials segment cash gross margin rising from ~18% (FY2022) to ~29% through first nine months of 2025 .
- Operating cash flow: YTD Q3’25 operating cash flow $290mm; targeting >9% of revenue for 2025 .
Compensation Structure vs. Performance Metrics
- Mix and targets: Total direct comp targeted around market 50th percentile; AIP tied to EBITDA (80%), OCF% (20%) with safety multiplier; LTIP 75% performance-based (Relative TSR 50%; RONA 25%), 25% time-based RSUs .
- Notable changes: 2024 AIP shifted from EBIT to EBITDA; CEO AIP target increased from 110% to 120% of salary (larger at-risk pay) .
- Pay-for-performance evidence: Above-target 2024 AIP payout (122%); 3-year TSR payouts at 150% (’21–’23) and 182% (’22–’24); RONA payout 164.4% for ’22–’24 .
- Equity vesting cadence: Significant service RSU vesting in March each year; ongoing performance award settlements drive supply; 2024 stock vested value $5.89mm for Larkin .
Multi-year Financial Trends
| Metric | FY2020 | FY2021 | FY2022 | FY2023 | FY2024 |
|---|---|---|---|---|---|
| Revenues ($USD) | $3,562,459,000 | $3,501,865,000 | $3,301,256,000 | $3,509,138,000 | $4,007,574,000 |
| EBITDA ($USD)* | $104,373,000 | $67,329,000 | $153,533,000 | $173,486,000 | $327,430,000 |
| Gross Profit Margin % | 9.68% | 10.36% | 11.19% | 11.30% | 14.29% |
| EBITDA Margin %* | 2.93% | 1.92% | 4.65% | 4.94% | 8.17% |
| *Values retrieved from S&P Global. |
Compensation Peer Group & Benchmarking
- Peer group used for 2024: Arcosa; Comfort Systems; Construction Partners; Cornerstone Building Brands; Dycom; Eagle Materials; EMCOR; Great Lakes Dredge & Dock; IES Holdings; KBR; MasTec; MYR Group; Primoris; Sterling; Summit Materials; Tetra Tech; Tutor Perini; Valmont .
- Positioning: Granite targeted total direct comp at ~50th percentile for comparable roles; CEO and NEO base salaries were slightly below peer medians in aggregate; LTIP target opportunity ~14% below median (conservative) .
Risk Indicators & Red Flags
- Hedging/pledging prohibited; stock ownership and retention requirements enforced .
- Clawback policy implemented (Oct 2023); no clawbacks required under the policy for prior restatements, though historical recoveries occurred per SEC settlement relating to prior CEO (not Larkin) .
- No option repricing; grant-timing policy avoids MNPI proximity; RSUs include dividend equivalents but pay only upon vesting .
Investment Implications
- Alignment: High at-risk pay tied to EBITDA/OCF, TSR, and RONA supports shareholder alignment; CEO complies with stringent 5x salary ownership and retention, with anti-hedging/pledging policies reducing misalignment risk .
- Vesting-driven supply: Annual March service RSU vesting (e.g., 10,749 RSUs in Mar 2026; 4,928 RSUs in Mar 2027) plus periodic performance award settlements suggest predictable insider-related supply; recent open-market sale (Apr 2025) may indicate personal liquidity or tax-related selling , .
- Retention & CIC economics: Robust double-trigger CIC (estimated $25.48mm as of FY2024) and two-year non-solicit reduce near-term retention risk, while payouts are capped to avoid excise tax gross-ups; governance mitigates CEO/chair dual-role concerns via independent Chair .
- Execution track record: Record CAP and materials margin expansion, plus raised 2025 EBITDA margin guidance, point to continued earnings power under Larkin’s plan; watch cash conversion (>9% OCF target) and best-value conversion pace for revenue timing upside/downside .
Note: All financial metric values and margins marked with an asterisk are retrieved from S&P Global.