Robert Ritchie

About Robert Ritchie

Robert “Rob” Ritchie is Senior Vice President, Food & Industrial Ingredients (LATAM and U.S./Canada) at Ingredion; he was appointed SVP, Americas effective May 2, 2023 and assumed the LATAM and U.S./Canada remit in January 2024 . He is 55 and has 27 years with Ingredion, having led U.S./Canada sweeteners and Mexico before his current role . Ritchie’s annual incentive is tied 70% to Adjusted EBITDA (40% company, 15% F&II U.S./Canada, 15% F&II LATAM), 15% Working Capital as % of Net Sales, 15% Cost/Productivity, and 20% personal objectives; 2024 performance translated to a 147.5% payout for him . Company context under his portfolio: record 2024 EPS (+13% YoY) with ~30% shareholder return, strong margin expansion, and 2022–2024 Adj. EBITDA CAGR of 11% versus peers’ decline, underscoring pay-for-performance alignment .

Past Roles

Fixed Compensation

Performance Compensation

Annual Incentive Plan (AIP) – Design and Results (2024)

Long-Term Incentive (LTI) – 2024 Grants (mix and details)

• LTI mix: PSUs 50%, RSUs 25% (3-year cliff), Options 25% (10-year term; 3-year ratable) .
• Dollar values approved for 2024 annual grant: PSUs $400,000; RSUs $200,000; Options $200,000 (grant date 2/13/2024) .
• Grant-date share/option details (2/13/2024):
  • PSUs: target 3,658 (0–200% payout range)
  • RSUs: 1,829
  • Stock options: 7,596 @ $108.38

Equity Ownership & Alignment

Vesting Schedules (key awards)

Employment Terms

• Appointment letter (Apr 16, 2023): SVP, Food & Industrial Ingredients Americas effective 5/2/2023; base salary $500,000; AIP target 70% (pro-rated for 2023); off-cycle RSU grant $300,000 (3-year cliff vest); at-will employment .
• Executive Severance/CIC:
  • CIC: For Ritchie (covered by CIC Plan), cash severance equal to 2x base salary + 2x target annual bonus (lump sum), plus COBRA at full cost for up to 18 months and 12 months outplacement; equity: double-trigger—within 2 years of CIC upon termination without Cause or for Good Reason, options/SARs vest, other awards vest at target .
  • Non-CIC severance: Executive Severance Plan (Section 16 officers) provides benefits if involuntarily terminated without Cause or for Good Reason, subject to restrictive covenants; separate from CIC plan .
  • Modeled potential payouts (as of 12/31/2024): Involuntary Termination Without Cause total $2,912,238; Change-in-Control total $4,327,228 (components include cash severance $1,820,000; target AIP $390,000; equity acceleration values; benefits and outplacement) .
  • “Good Reason” definition includes material pay cut, relocation >50 miles increasing commute, material reduction in duties, etc. .

Compensation Structure Analysis

• Mix: 2024 LTI continues balanced structure of 50% PSUs, 25% RSUs, 25% stock options—supports multi-metric, long-term alignment and retention .
• Short-term incentives: 2024 AIP target increased to 75% of salary (from 70% in 2023), indicating higher at-risk cash exposure; payout driven by strong performance on working capital and cost/productivity, and above-target Adjusted EBITDA .
• Equity sizing: 2024 total annual equity grant value $800,000 (PSUs $400k, RSUs $200k, Options $200k) tailored to scope and market positioning .
• Realization: 2024 equity activity shows modest option exercises (1,195 shares) and significant vesting (5,133 shares), adding to realizable pay while retaining substantial unvested overhang into 2026–2027 .

Equity Ownership & Alignment (detail table)

Performance & Track Record (context)

• 2024 results included record gross margins (~24%), record EPS (+13%), and ~30% shareholder return; strong cash from operations (> $1.4B), reinforcing balance sheet and investment capacity .
• 2022–2024: Adj. EBITDA CAGR 11% with average Adj. EBITDA margin ~15%, outperforming selected peers; 2024 EV/Adj. EBITDA multiple below peers (implying relative value) .
• Strategic execution under his remit includes pivoting away from structural HFCS declines (~1–2% annual volume decline industry-wide) toward dextrose/glucose, biofermentation and biosolutions, repurposing capacity (e.g., Argo project) to sustain grind utilization and margins .

Employment Terms (restrictions)

• Participation in Executive Severance Plan requires agreement to confidentiality, IP, non-compete (subject to applicable law), and non-solicitation provisions; loss of Section 16 status ends participation .

Investment Implications

• Alignment: Ritchie’s pay is heavily performance-based—AIP tied to company and segment EBITDA plus working capital and cost productivity, and LTI split across PSUs/RSUs/options—aligning compensation with value creation drivers and multi-year outcomes .
• Retention and selling pressure: Unvested RSUs/PSUs vesting in 2026–2027 and ratable option vesting in 2025–2027 create ongoing retention hooks; 2024 realizations (modest option exercises and vestings) suggest manageable near-term selling pressure, with company policy limiting hedging/pledging risk .
• Change-in-control risk economics: Double-trigger equity acceleration at target and 2x cash severance protect continuity but can increase cost under a transaction scenario; modeled CIC payout of ~$4.33m vs. ~$2.91m for a non-CIC termination (12/31/24 basis) provides clear incentives and known overhang .
• Execution risk: Portfolio transition away from HFCS toward biosolutions and glucose/dextrose is active; segment targets were met/above in 2024, but continued delivery hinges on maintaining high grind utilization and executing capacity repurposing projects .