Kimberly Ryan
HillenbrandAbout Kimberly Ryan
Kimberly K. Ryan, age 58, is President and CEO of Hillenbrand, Inc. (HI) and a director since 2021; she previously led Coperion and Batesville and held senior roles at Hill‑Rom, with a BBA in Accounting from Iowa State University . Under her tenure, FY2024 company metrics were Net Income $211.0 million and Adjusted EBITDA $515.8 million, with consolidated Net Revenue of $2,974 million used for incentive calibration; the Company’s TSR value of a fixed $100 investment stood at $103.45 versus the S&P 400 Midcap Industrials Index peer figure of $209.16 for FY2024, following $157.45 and $134.78 in FY2023 and FY2022 respectively . HI’s compensation design targets pay-for-performance with 85% of her target core compensation “at risk” and benchmarked around the 50th percentile of a defined peer group . The board separates the CEO and Chair roles and deems Ryan not independent, mitigating dual-role concerns via an independent Chair and independent committees; executive sessions are held after each board and committee meeting .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Hillenbrand, Inc. | President & CEO | Since 2021 | Led transformation to a pure‑play industrial company; capital allocation, DEI and sustainability oversight; portfolio M&A execution . |
| Hillenbrand, Inc. | EVP (transition) | 2021 | Executive transition to CEO; leadership alignment . |
| Coperion (Hillenbrand) | President; SVP Hillenbrand | 2015–2021 | Grew APS segment, oversaw Rotex; global operations and process solutions expertise . |
| Batesville (Hillenbrand) | President; SVP Hillenbrand | 2011–2015 | Led business operations prior to divestiture; manufacturing/operations leadership . |
| Hill‑Rom, Inc. | SVP Post Acute Care; SVP IT & Office of Program Leadership; VP Shared Services | 2003–2011 | Risk oversight, enterprise IT leadership incl. ERP; shared services optimization . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Kimball International, Inc. | Director; Audit member; Board Chair; Comp/Gov committees | 2014–2023; Chair 2018–2021 | Board leadership and governance experience . |
| National Association of Manufacturers | Director | Since 2022 | Industry advocacy & manufacturing policy . |
| Iowa State University College of Business | Dean’s Advisory Council | Since 2022 | Academic-industry engagement . |
| Conexus Indiana | Director | 2018–2021 | Manufacturing and logistics ecosystem contributor . |
Multi‑Year Compensation (CEO)
| Metric | FY2022 | FY2023 | FY2024 |
|---|---|---|---|
| Salary ($) | $786,356 | $917,808 | $1,002,213 |
| Stock Awards ($) | $3,220,167 | $5,100,067 | $4,973,173 |
| Non‑Equity Incentive (STIC) ($) | $1,044,844 | $416,250 | $640,338 |
| All Other Compensation ($) | $169,691 | $134,755 | $131,722 |
| Total Compensation ($) | $5,221,058 | $6,568,880 | $6,747,446 |
Fixed Compensation (FY2024)
| Component | Amount/Details |
|---|---|
| Base Salary | $1,001,154 paid; STIC calculated off salary paid . |
| Savings Plan (401k) contribution | $20,579 . |
| Supplemental Retirement Plan (SRP) contribution | $111,143; SRP balance $1,033,259 . |
| Perquisites | Executive physicals, financial/tax planning reimbursement (program increased to $10,000 annually starting CY2025) . |
| Insurance | Group life; policy updated in CY2025 to 2x salary capped at $1,000,000 for U.S. execs . |
Performance Compensation
Short‑Term Incentive Compensation (STIC) – FY2024 Design and Results
| Metric (Hillenbrand consolidated) | Weight | Threshold | Target | Maximum | Actual | Payout |
|---|---|---|---|---|---|---|
| Adjusted EBITDA ($mm) | 50% | $456 | $570 | $655 | $516 | 68.6% |
| Net Revenue ($mm) | 25% | $3,225 | $3,544 | $3,792 | $2,974 | 0% |
| Cash Conversion Cycle (Days) | 25% | 79.2 | 66.0 | 52.8 | 72.3 | 76.1% |
| Company Performance Factor | — | — | — | — | — | 53.3% |
| CEO STIC Calculation | Value |
|---|---|
| Target STIC (% of base) | 120% |
| Target STIC ($) | $1,201,385 |
| Company Performance Factor | 53.3% |
| Individual Performance Factor | 100% |
| STIC Paid ($) | $640,338 |
Design notes: FY2024 widened EBITDA curves to allow 33⅓% payout at 80% of target; for FY2025 widened Revenue/Order Intake threshold to 80% for 33⅓% payout and increased CCC weight to 30% to emphasize cash generation .
Long‑Term Incentive Compensation (LTIC) – FY2024 Grants and Mechanics
| Award Type | Target Shares (12/7/2023) | Vest Schedule | Payout Mechanics |
|---|---|---|---|
| Time‑based RSUs | 40,737 | 33⅓% annually on Dec 7, 2024/2025/2026 | Dividends accrue and pay in shares at vest . |
| Shareholder Value RSUs | 40,737 | Cliff vest Sept 30, 2026 | Economic value model; 0x below 70%, 1.0x at 100%, 2.0x at ≥130% of expected value; dividends accrue . |
| Relative TSR RSUs | 40,737 | Cliff vest Sept 30, 2026 | 0% <25th pct; 100% at 50th; 200% ≥75th; no dividends . |
Track record: FY2022 LTIC measurement closed Sept 30, 2024 with Shareholder Value payout at 81% of target and Relative TSR payout at 0% (7th percentile), reflecting market-relative underperformance despite value creation .
Equity Ownership & Alignment
| Category | Amount/Details |
|---|---|
| Total Beneficial Ownership | 330,546 shares (includes 173,065 direct, 136,220 options exercisable within 60 days, 21,261 RSUs vesting within 60 days) . |
| Ownership % of outstanding | Less than 1% (HI had 70,413,053 shares outstanding as of record date) . |
| Unvested RSUs (time‑based) | 68,870 units as of Sept 30, 2024 . |
| Unearned Performance RSUs | 70,958 (Shareholder Value; FY2022/2025 cycles) and 90,489 (Relative TSR; FY2022/2025 cycles) at target as of Sept 30, 2024 . |
| Stock Ownership Guidelines | CEO required to hold ≥5x base salary; all Named Executive Officers currently meet or exceed required levels (performance RSUs excluded; time‑based RSUs count) . |
| Hedging/Pledging | Prohibited; no pledging or margin accounts allowed; none of the directors/executives have pledged HI shares . |
| Trade Controls | All trades must be pre‑cleared with Legal . |
| Clawback Policy | Dodd‑Frank compliant recoupment for restatements affecting incentive pay over prior 3 fiscal years . |
Employment Terms
| Scenario (as of Sept 30, 2024) | Salary and Cash | Equity Acceleration | Benefits Continuation | Total |
|---|---|---|---|---|
| Permanent Disability | $2,446,228 | $2,360,286 | $47,442 | $4,853,956 |
| Death | $1,140,338 | $2,360,286 | $0 | $3,500,624 |
| Termination without Cause | $2,680,338 | $2,668,652 | $47,442 | $5,396,432 |
| Resignation with Good Reason | $2,680,338 | $2,668,652 | $47,442 | $5,396,432 |
| Retirement (qualified) | $2,680,338 | $2,668,652 | $0 | $5,348,990 |
| Change‑in‑Control (double‑trigger) | $3,060,000 salary‑based; $4,312,338 incentive; $80,084 benefits; $6,314,402 equity; total $13,766,824 (no tax gross‑up; cutback if optimal after tax) . |
Key contract terms:
- Employment “at will”; severance for CEO equals 24 months base salary continuation plus benefits, with pro‑rata STIC/LTIC in certain terminations; non‑compete and non‑solicit typically 1–2 years post‑termination .
- Change‑in‑control agreements require a qualified termination within two years of a CIC (double‑trigger), provide 3x salary and target STIC for CEO, immediate vesting using greater of target/actual for awards made after Feb 11, 2021; no excise tax gross‑ups .
Board Service and Dual‑Role Implications
- Board Service History: Director since 2021; not independent due to CEO role; does not sit on Audit, Compensation, or Nominating/Governance committees .
- Governance Structure: HI mandates an independent Chair and at least 80% independent directors; CEO cannot serve as Chair, mitigating concentration of power risks .
- Attendance and Executive Sessions: Board met 7 times in FY2024; each director attended ≥75% of meetings; executive sessions of non‑management directors held after each board and committee meeting .
Performance & Pay Linkage Indicators
| Indicator | FY2024 Data |
|---|---|
| Adjusted EBITDA | $515.8 million . |
| Net Income | $211.0 million . |
| Consolidated Net Revenue (for STIC calibration) | $2,974 million . |
| TSR Value of $100 Investment | $103.45 (company) vs $209.16 (peer index) . |
| CEO Pay Mix | ~85% at‑risk; LTIC maximums increased to 200% of target since FY2023 . |
| Say‑on‑Pay Support | >94% approval each year for the past eleven years . |
Compensation Structure Analysis
- Increased at‑risk equity emphasis and higher LTIC maxima (from 175% to 200%) raise upside for sustained outperformance while maintaining rigorous 3‑year measurement periods .
- FY2024 STIC curve changes lowered the payout threshold for EBITDA to 80% achievement (33⅓% payout), and in FY2025 will do the same for Revenue/Order Intake and increase CCC weight, signaling focus on cash discipline amid transformation; potential investor watchpoint is whether lowered thresholds dilute pay-for-performance if multi‑metric outcomes persist below target .
- Peer benchmarking targets the 50th percentile and utilizes a refreshed group (added Columbus McKinnon), balancing market competitiveness with shareholder alignment .
Risk Indicators & Red Flags
- No hedging/pledging allowed; none of the executive/board holdings are pledged; trades pre‑cleared by Legal .
- No tax gross‑ups under CIC agreements; use of cutback optimization reduces shareholder-unfriendly outcomes .
- Related party transactions: none material identified since FY2023; robust policy and committee oversight in place .
- Compensation risk assessment: Committee concluded no compensation-related risks reasonably likely to have a material adverse effect (Dec 4, 2024) .
Compensation Peer Group & Targets
- Peer group (19 companies at FY2024 end) includes Acuity Brands, Dover, Fortive, IDEX, ITT, Regal Rexnord, Timken, etc.; target core compensation benchmarked to the 50th percentile with adjustments for role scope and performance .
Equity Ownership Policy and Compliance
- CEO ownership guideline: ≥5x base salary; Named Executive Officers meet/exceed guidelines; performance RSUs excluded from compliance, time‑based RSUs included; unexercised options excluded .
Investment Implications
- Alignment: High at‑risk pay mix with multi‑metric STIC (EBITDA/revenue or order intake/CCC) and dual LTIC (economic value and relative TSR) tightly links realized pay to operating cash generation and shareholder value; clawback and no‑hedging policies reinforce alignment .
- Watchpoints: FY2024 missed revenue target and low TSR percentile payout for the FY2022 LTIC support active monitoring of execution against transformation goals; lowered STIC thresholds and focus on CCC could stabilize payouts despite softer top‑line, but investors should track whether cash conversion gains sustain without compromising growth .
- Governance mitigants: Independent Chair, independent committees, and prohibition on CEO serving as Chair reduce dual-role risks; strong shareholder support (>94% say‑on‑pay) indicates broad endorsement of pay practices, though TSR underperformance vs index in FY2024 warrants continued scrutiny of value creation trajectory .