Mark Mikes
HUBBELLAbout Mark Mikes
Mark E. Mikes, age 60, is President of Hubbell’s Electrical Solutions Segment (HES) since July 2023 and has been with Hubbell since 1989 across multiple leadership roles in Hubbell Power Systems and enterprise operational excellence . Company performance during his tenure includes 2024 net sales of $5.6B, adjusted diluted EPS of $16.57, and free cash flow of $811M, underscoring execution against growth and margin priorities . The 2022–2024 performance share cycle paid at 200% across all three metrics (Relative Sales Growth, Adjusted Operating Profit Margin, Relative TSR), reflecting strong value creation and alignment with shareholders; Mikes’ projected shares for that cycle doubled vs. target (2,018 vs. 1,009) .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Hubbell Power Systems (HPS) | Division President | Nov 2019–Jul 2022 | Led integration of acquired utility businesses under a unified structure, improving profitability and cash generation . |
| Hubbell Power Systems | Division President & Enterprise Operational Excellence | Jul 2022–Jun 2023 | Drove footprint optimization and operational productivity ahead of promotion to HES President . |
| Hubbell (multiple roles) | Various positions | 1989–Nov 2019 | Progressive leadership roles across manufacturing and operations . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| — | — | — | None disclosed in company filings . |
Fixed Compensation
| Year | Base Salary ($) | Target Bonus % | STI Target ($) | STI Award ($) |
|---|---|---|---|---|
| 2023 | 558,125 | 67.5% (prorated for role change) | 405,000 | 733,500 |
| 2024 | 612,692 | 75% | 461,250 | 558,100 |
Perquisites and retirement contributions (2024): Perquisites $10,000; Retirement contributions $94,234 .
Performance Compensation
Short-Term Incentive (STI) Design
- Weighting: 80% financial metrics; 20% strategic objectives .
- Enterprise metrics: Adjusted EPS and Free Cash Flow; Segment metrics: Operating Profit (OP) and Operating Cash Flow (OCF) for segment leaders .
2024 STI Results – Mikes (HES President)
| Metric | Weighting | Target | Actual/Performance vs Target | Payout % | Basis |
|---|---|---|---|---|---|
| Adjusted EPS (Enterprise) | Part of 80% | $16.35 | 102% of target | 115% | Non-GAAP, see 10-K reconciliation |
| Free Cash Flow (Enterprise) | Part of 80% | $793M | 101% of target | 107% | Non-GAAP, see 10-K reconciliation |
| HES Operating Profit | Part of 80% | 96% vs PY | 107% | 146% | Segment metric |
| HES Operating Cash Flow | Part of 80% | 100% of OP | 102% | 110% | Segment metric |
| Strategic Objectives | 20% | Qualitative targets | 110% payout | 110% | Four pillars average |
| Total Composite Payout | — | — | — | 121% | STI Target $461,250; Award $558,100 |
Long-Term Incentive (LTI) Design and Grants (2024)
- 75% performance-oriented; 25% retention-oriented (RS). Performance Share metrics equally weighted: Relative Sales Growth (RSG), Adjusted Operating Profit Margin (OPM), Relative TSR .
- Vesting: PS over 3-year periods; RS 3-year cliff; SARs vest ratably over 3 years .
| Award Type | Grant Date | Threshold (#) | Target (#) | Max (#) | Fair Value ($) | Notes |
|---|---|---|---|---|---|---|
| PS/RSG | 2/6/2024 | 241 | 482 | 964 | 164,454 | Relative sales growth vs S&P Capital Goods 900 |
| PS/OPM | 2/6/2024 | 234 | 468 | 936 | 159,677 | Adjusted OPM targets set at grant |
| PS/TSR | 2/6/2024 | 234 | 468 | 936 | 226,507 | Relative TSR vs index |
| RS | 2/6/2024 | — | 1,064 | — | 375,113 | 3-year cliff vest |
| SAR | 2/6/2024 | — | 4,260 | — | 375,021 | Base price $352.55; 3-year ratable vest |
Performance Share 2022–2024 Payout: All three metrics paid at 200%; Mikes projected 2,018 shares vs 1,009 target (final tally post-peer reporting) .
Stock vesting/realization in 2024: RS vested 574 shares ($206,887); PS vested 2,250 shares ($814,946); SARs exercised 4,000 shares (value realized $986,305) .
Performance Share Target Levels (Illustrative)
| Metric | Target | Threshold | Max | Payout Scale |
|---|---|---|---|---|
| Relative Sales Growth | 50th percentile | 25th percentile | >75th percentile | 0–200% |
| Relative TSR | 50th percentile | 25th percentile | >75th percentile | 0–200% |
| Adjusted OPM (2024–26) | 21.00% | 19.25% | 22.75% | 0–200% |
Equity Ownership & Alignment
| Date (As of) | Common Stock | SARs Exercisable/Obtainable | Total Beneficial Ownership | Pledged Shares | Ownership Policy Compliance |
|---|---|---|---|---|---|
| Mar 8, 2024 | 1,942 | 10,012 | 11,954 | Prohibited by policy | Executives in compliance |
| Mar 7, 2025 | 1,260 | 10,034 | 11,294 | Prohibited by policy | Executives in compliance |
Outstanding equity awards (12/31/2024) include RS not vested (504; 933; 456; 1,064 by grant) and PS unearned (1,009; 829; 1,418) plus unexercisable SARs by grant dates/prices (241.17; 328.73; 352.55) . Stock ownership and retention policy requires retaining net shares until meeting minimum ownership; five-year compliance window; includes RS and in-the-money vested SARs; prohibits counting unearned PS . Policy prohibits hedging and pledging; insider trading policy applies broadly .
Employment Terms
- Change-in-Control: Double trigger required; lump-sum cash 2.0x base salary and 2.0x target bonus (Mikes), plus pro-rated target bonus, continued insurance, and outplacement; no single-trigger vesting; SARs/RS/PS treatment per plan with acceleration upon qualifying termination within 12 months post-CIC if awards assumed/continued . Mark Mikes’ CIC Severance Agreement effective July 1, 2023 .
- Severance: Senior Severance Policy for involuntary terminations (senior management) .
- Clawback: 2023 Compensation Recovery Policy to recoup erroneously awarded incentive comp after restatements (3 prior fiscal years) .
- Tax gross-ups: Company states limited gross-ups; no excise/severance gross-ups .
- Pensions/Deferred Comp: Mikes participates in the frozen DB Plan and DB Restoration Plan; 2024 change in pension value $104,386 . DC Plan and DC Restoration contributions detailed in 2024 All Other Compensation footnote .
Compensation Structure Analysis
- Mix and risk: Majority of pay at risk with 75% of LTI performance-based; shift toward PS metrics since 2022 strengthens pay-for-performance alignment .
- STI rigor: Enterprise performance delivered blended 112% payout; HES segment exceeded OP/OCF targets with blended 134% payout; overall composite 121% indicates balanced achievement across financial and strategic goals .
- Retention signals: 2023 included a targeted retention award for Mikes (RS ~$124,926 and SARs ~$125,009) concurrent with segment leadership transition, mitigating near-term retention risk .
- Governance safeguards: Robust ownership policy, hedging/pledging prohibition, clawback, and no employment agreements with NEOs (CIC agreements used instead) reduce misalignment risks .
Risk Indicators & Red Flags
- Insider activity: In 2024, Mikes exercised 4,000 SARs (value realized $986,305) and had RS/PS vestings; while typical for scheduled vesting/exercises, monitor future Form 4s for net-share settlements vs open-market sales to gauge selling pressure .
- Pledging/Hedging: Prohibited; mitigates alignment concerns .
- Say-on-Pay: Company-wide 2024 support of 95.1% suggests investor acceptance of pay practices feeding into NEO incentive architecture .
Investment Implications
- Alignment: Strong linkage of incentives to growth, margins, and TSR, with recent PS cycles paying at 200% and HES segment exceeding OP/OCF targets, supports confidence in execution and shareholder alignment .
- Retention risk: Targeted 2023 retention grants plus CIC protections (2.0x salary/bonus, double-trigger) reduce near-term turnover risk for Mikes during HES margin-improvement playbook execution .
- Monitoring: Track upcoming vesting calendars (RS and PS awards from 2022–2024 grants) and any SAR exercises to assess potential supply from insider transactions; confirm continued compliance with ownership policy and absence of pledging .