Tom Deitrich
ITRONAbout Tom Deitrich
Thomas L. Deitrich is President and CEO of Itron and a Class 2 director, age 58, serving on Itron’s board since 2019; he is the sole non‑independent director and does not sit on any board committees . His background spans more than 20 years of executive leadership across industrial IoT, networking, and smart utility management, with expertise in product management, R&D, and supply chain . Under his leadership, Itron delivered 2024 revenue of ~$2.44B (+12% YoY), adjusted EBITDA of ~$323.6M (+43% YoY), and non‑GAAP diluted EPS of $5.62 (+67% YoY) . Over the 2022–2024 PRSU cycle, performance averaged 138.69% with a TSR at ~87th percentile vs Russell 3000, yielding a 1.12x TSR multiplier ; by contrast, the 2021–2023 PRSU cycle earned 85.31% after a TSR ~35th percentile .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Global technology industry (industrial equipment, telecommunications, semiconductors) | Executive leadership roles across product, R&D, supply chain | 20+ years | Industrial IoT, networking, smart utility management; product/R&D/supply chain leadership |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Onsemi Corporation | Director | Current | Brings semiconductor industry insights to Itron’s board governance |
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | $830,000 | $875,000 | $900,000 |
| Target Annual Bonus (% of Base) | — | 125% | 125% |
Performance Compensation
Annual Cash Incentive (IIP) – FY 2024 Design and Outcomes
| Component | Weight | Target | Actual | Payout Basis | Result |
|---|---|---|---|---|---|
| Adjusted EBITDA | 80% (financial overall) | $250.0M | $323.6M | 0–150% linearly interpolated | 118.3% of target (financial portion) |
| Revenue | 80% (financial overall) | $2,350.0M | $2,440.8M | 0–150% linearly interpolated | 118.3% of target (financial portion) |
| GGI bookings (binary) | 20% (non‑financial overall) | >$240M | Pass | 0–100% | 100% (non‑financial portion) |
| GHG emissions intensity reduction (binary) | 20% (non‑financial overall) | >5% vs 2023 | Pass | 0–100% | 100% (non‑financial portion) |
| CEO Total IIP Payout | — | $1,125,000 | — | — | $1,944,844 (172.9% of target) |
Historical IIP payout for CEO: 2023 actual $1,531,250, 140% of target .
Long‑Term Incentives (LTIP) – Grants and Earnouts
| Metric | FY 2023 Grant | FY 2024 Grant |
|---|---|---|
| LTIP Target Value ($) | $4,700,000 (PRSUs $3,196,000; RSUs $1,504,000) | $6,000,000 (PRSUs $4,000,000; RSUs $2,000,000) |
| RSUs Granted (#, Date) | 27,055 (02/23/2023) | 26,691 (02/23/2024) |
| PRSUs Target (#, Date) | 57,492 (02/23/2023) | 53,383 (02/23/2024) |
| PRSUs Max (#) | 143,730 (2023 cycle; 250%) | 133,458 (2024 cycle; 250%) |
| PRSU 2022–2024 Earnout | Target 46,339; Actual 71,979 (155.33%) | Basis: avg non‑GAAP EPS 138.69%; TSR adj 1.12x |
| PRSU 2021–2023 Earnout | Target 14,958; Actual 12,760 (85.31%) | TSR ~35th percentile → 0.85x |
Vesting mechanics: RSUs vest one‑third at 1st anniversary, then quarterly for two years; PRSUs vest after three‑year performance with +/-25% TSR modifier vs Russell 3000 .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership (CEO) | 423,503 shares total; includes 185,180 options exercisable within 60 days; 25,000 shares held in trust for son |
| Ownership as % of SO | <1% |
| Stock Ownership Guidelines | CEO 6.0x base salary; executives met guidelines on rolling 12‑month basis by YE 2024 |
| Anti‑Hedging/Pledging | Prohibits hedging, pledging, margin accounts, derivatives in Itron stock |
| Options Outstanding (select) | 2015: 37,741 @ $35.13 exp. 12/10/2025; 2016: 37,957 @ $40.05 exp. 2/24/2026; 2017: 22,701 @ $65.55 exp. 2/23/2027; 2018: 20,116 @ $69.30 exp. 2/22/2028; 2019: 76,337 @ $76.55 exp. 9/19/2029; 2020: 28,069 @ $87.27 exp. 2/20/2030 |
| Unvested RSUs (12/31/2024) | 9,268 (2022 grant); 11,279 (2023 grant); 26,691 (2024 grant) |
| PRSUs (unearned at max, 12/31/2024) | 143,730 (2023–2025 cycle max); 133,458 (2024–2026 cycle max) |
| Option Exercises and Stock Vested (2024) | Exercised 46,038 options ($3,081,040 value); Vested 102,009 shares ($10,306,243 value) |
Upcoming RSU vesting schedule (CEO, from 12/31/2024):
- 2025: 2/23 2,255; 5/23 2,256; 8/23 2,256; 11/23 2,255 (plus tranche amounts from 2023/2024 grants)
- 2026: Quarterly tranches continuing; 2/23 2,257 etc.
Employment Terms
| Provision | Summary |
|---|---|
| Employment Agreements | None (no formal employment agreement) |
| Severance Policy (involuntary, not for cause) | Cash severance equal to 1x base salary; employer benefit premiums/reimbursements for 1 year; outplacement; requires release; 1‑year non‑compete (where enforceable), non‑solicit, non‑disparagement |
| Change‑in‑Control (CIC) Cash Severance | 2.5x base salary + target annual bonus (lump sum) for CEO |
| CIC Other Benefits | Pro‑rata annual incentive (greater of target or actual as determined by Board); 2.5 years welfare/health benefits; reimbursement of legal fees to enforce agreement; restrictive covenants (1‑year non‑compete/non‑solicit, non‑disparagement); no excise tax gross‑up |
| CIC Equity Treatment | Double‑trigger acceleration; PRSUs vest at greater of target or actual and pro‑rated to CIC or termination (if assumed) per cycle terms |
| Termination Scenarios (CEO, as of 12/31/2024) | Termination w/o cause: Severance $900,000; benefit continuation $46,938 . CIC termination: Cash severance $5,062,500; benefit continuation $94,846; pro‑rata annual incentive $1,944,844; RSU acceleration $5,129,102; PRSU acceleration $17,335,580 . Death/Disability: RSUs $5,129,102; PRSUs $25,948,050 . Retirement (subject to rules): RSUs $2,230,993; PRSUs $14,057,961 |
| Clawback Policies | Rule 10D‑1/Nasdaq 5608 compliant Incentive Compensation Recovery Policy (post‑Dec 1, 2024 awards); legacy clawback for pre‑Dec 1, 2024 allowing recovery in fraud/material restatement scenarios |
Board Governance
- Structure: Separate independent Board Chair (Diana D. Tremblay); CEO not Chair .
- Independence: Majority independent; CEO Deitrich is sole non‑independent director; all committee members independent; CEO not on any committees .
- Committees: Audit/Finance; Compensation; Nominating & Corporate Governance—all with independent members and charter transparency .
- Meeting attendance: 2024—Board met 8 times; all directors attended ≥75%; executive sessions of independent directors held at least twice annually . 2023—Board met 7 times; all directors attended ≥75%; executive sessions ≥2 annually .
- Lead Independent Director: Policy to appoint if roles combined; currently separate Chair/CEO .
- Director compensation: Employee directors (including CEO) receive no director compensation .
Director Compensation (for completeness re dual roles)
- Non‑employee director base retainer 2024: $275,000 ($75,000 cash; $200,000 stock); Board Chair retainer $375,000; Vice Chair $315,000; committee chair/member fees disclosed .
- CEO receives no director fees as an employee director .
Compensation Peer Group and Say‑on‑Pay
- Peer Group: 2024 review added Advanced Energy Industries and Array Technologies; removed National Instruments and Xylem; peer revenue and market cap context disclosed; Itron targets market median positioning .
- Say‑on‑Pay Support: 2023 ~92% approval ; 2024 ~94% approval .
- Best‑practice features: Heavy variable pay, performance‑based equity, stock ownership guidelines, clawbacks; no employment agreements, no single‑trigger CIC cash, no tax gross‑ups, no hedging/pledging, no option repricing .
Performance & Track Record
| Metric | FY 2023 vs FY 2022 | FY 2024 vs FY 2023 |
|---|---|---|
| Revenue ($) | ~$2.174B vs ~$1.796B (+21%) | ~$2.441B vs ~$2.174B (+12%) |
| Adjusted EBITDA ($) | ~$225.6M vs ~$95.1M (+137%) | ~$323.6M vs ~$225.6M (+43%) |
| Non‑GAAP Diluted EPS ($) | $3.36 vs $1.13 (+197%) | $5.62 vs $3.36 (+67%) |
Strategic execution highlights (2024): backlog conversion post supply chain volatility; grid edge intelligence expansion via small acquisition; manufacturing consolidation to an asset‑light footprint; convertible notes issuance improving flexibility; bookings ~$2.7B driven by distributed intelligence content .
Compensation Structure Analysis
- Mix shift: CEO LTIP increased to $6.0M in 2024 (from $4.7M in 2023) with 67% PRSUs and 33% RSUs, reinforcing performance orientation; other NEOs at 50/50 PRSU/RSU .
- Annual plan metrics tightened: 2024 IIP refocused non‑financial goals to GGI bookings, aligning incentives with targeted growth at scale; financial thresholds raised vs 2023 .
- PRSU leverage raised vs prior cycles: 2024 earnout for 2022–2024 at 155.33% due to high EPS attainment and strong relative TSR; contrasts with 85.31% in 2021–2023 .
- Governance safeguards: double‑trigger CIC equity; clawbacks; prohibition on hedging/pledging; no tax gross‑ups; high say‑on‑pay support .
Risk Indicators & Red Flags
- Pledging/Hedging: Prohibited—reduces misalignment risk .
- Option repricing/tax gross‑ups: Not permitted/no gross‑ups—shareholder‑friendly .
- Related‑party transactions: None required to be disclosed for FY 2024 .
- CIC economics: CEO 2.5x salary+bonus and material equity acceleration under double‑trigger; noteworthy for potential M&A cost modeling .
- Insider selling pressure: 2024 vesting of 102,009 shares and exercise of 46,038 options suggests periodic supply; trading governed by insider policy .
Equity Ownership & Alignment Details
| Element | Value |
|---|---|
| CEO stock ownership guideline | 6.0x base salary; met by YE 2024 |
| Beneficial ownership | 423,503 shares (<1%); includes 185,180 options exercisable within 60 days and 25,000 in trust |
| 2024 RSU/PRSU market values (12/31/2024) | RSUs: $2,898,109 (2024 grant); PRSUs max values: $14,490,815 (2024 cycle), $15,606,203 (2023 cycle) at $108.58/share |
Investment Implications
- Strong pay‑for‑performance linkage: Elevated PRSU outcomes and raised IIP thresholds, coupled with 89% at‑risk CEO pay in 2024, signal confidence in EPS/EBITDA delivery; this supports estimate momentum and upside risk if execution continues .
- Vesting and supply dynamics: Quarterly RSU vesting and significant PRSU earnouts can add insider supply near vest dates; monitor Form 4s around 2/23, 5/23, 8/23, 11/23 windows and option expirations through 2025–2030 .
- Alignment safeguards: No pledging/hedging, ownership guideline compliance, and robust clawbacks reduce governance risk; high say‑on‑pay approvals suggest investor acceptance of structure .
- M&A scenario planning: CEO CIC cash 2.5x salary+bonus plus equity acceleration under double‑trigger represents a material transaction cost; factor into deal models and retention packages in change‑in‑control contexts .
- Execution tailwinds: Bookings strength (~$2.7B), grid‑edge positioning, and EBITDA/FCF expansion under Deitrich provide fundamental support; continued non‑GAAP EPS outperformance underpins PRSU earnouts and could sustain equity comp value realization .