John Hewitt
About John Hewitt
John R. Hewitt, age 67, is President and Chief Executive Officer of Matrix Service Company and has served as a director since May 2011. He spent ~25 years at Aker Solutions and predecessors in executive roles across EPC operations before joining Matrix; he holds a finance degree from Stetson University and an engineering degree from the Florida Institute of Technology . Recent pay-versus-performance disclosures show Company TSR (fixed $100 starting June 30, 2021) at 128.67 for FY2025, alongside GAAP net loss of $(29.5) million and adjusted operating loss of $(31.4) million, framing ongoing turnaround progress with equity-linked compensation outcomes . Management commentary and guidance emphasize strengthening margins and backlog with FY2026 revenue guided to $875–$925 million vs. $769.3 million actual in FY2025, and Q1 FY2026 revenue up 28% YoY to $211.9 million .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Aker Solutions | Vice President; executive oversight on major capital projects (power/LNG) | Pre-2011 | Oversight of major capital EPC projects; LNG and power domain expertise |
| Aker Solutions E&C US, Inc. | President, U.S. Operations | 2007–2009 | Managed all construction services in North America |
| Aker Construction Inc. | President | Prior to 2007 | Full P&L responsibility for multi‑discipline industrial construction across North America |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Philbrook Museum of Art; Tulsa Community College Foundation; Tulsa Regional Chamber; Committee of One Hundred – Tulsa; Tulsa Boys Home | Director/Board member | — | Community leadership; regional network relevance |
Fixed Compensation
| Metric | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Base Salary ($) | 800,000 | 800,000 | 800,000 |
| Target Bonus (% of Salary) | 100% | 100% | 100% |
| Actual Annual Bonus Paid ($) | 0 (no payout) | 0 (no payout) | 0 (threshold not met; operating loss) |
| Perquisites (life/disability/401k match) ($) | 36,852 | 32,510 | 33,189 |
Notes:
- CEO base salary unchanged since September 2018 .
- Management directors receive no additional board fees .
Performance Compensation
Short‑Term Incentive (STI) – FY2025 Design and Outcome
| Component | Weighting | Targets/Thresholds | Actual FY2025 Outcome |
|---|---|---|---|
| Adjusted Operating Income (financial) | 85% | Consolidated threshold: $7.4m; Target: $14.7m (subsidiary thresholds/targets also set) | Below 50% of threshold at consolidated and operating levels; no financial payout |
| Safety: TRIR | 5% (1/3 of 15%) | Target ≤ 0.50 | Consolidated TRIR 0.51; MSI 0.63; MNAC 0.48 |
| Safety: DART | 5% | Target ≤ 0.25 | Consolidated 0.21; MSI 0.35; MNAC 0.00 |
| Safety: QHSE Corrective Action Completion | 5% | ≤ 5 days | Consolidated 3.1 days; MSI 2.0; MNAC 10.5; PDM 6.4 |
| STI Payout | — | 50% of financial threshold must be achieved before any financial payout; safety potentially payable subject to funding | No STI paid for FY2025 due to operating loss/funding limits |
Design notes: CEO STI measured at consolidated level; metrics set post-fiscal year start; Committee retains negative discretion .
Long‑Term Incentive (LTI) – FY2025 Grants (8/27/2024)
| Award Type | CEO Mix | Shares/Units | Value per Share | Grant Date Fair Value |
|---|---|---|---|---|
| Service‑based RSUs (stock‑settled) | 20% | 82,902 | $9.74 | $807,465 |
| PSUs (TSR vs peer group; 3‑yr cliff) | 60% | 124,352 target | $11.49 (Monte Carlo) | $1,428,805 |
| Total FY2025 LTI | — | — | — | $2,236,270 |
- Vesting: RSUs vest over 4 years; for retirement‑eligible NEOs (Hewitt), RSUs vest in full at 1‑year but settle in 4 equal annual installments; PSUs cliff‑vest at 3 years based on relative TSR (0–200%) .
- FY2023 PSU (performance period FY2023–FY2025) paid at 109% of target (Aug 2025) .
- Company currently does not grant stock options/SARs in executive program .
Selected Upcoming Vest/Settlement Schedule (Hewitt)
| Award | Shares | Key Date(s) |
|---|---|---|
| Service‑based RSUs (stock/cash) | 20,726 | 8/27/2026 (settlement for FY2025 grant per retirement‑eligible rules) |
| Service‑based RSUs (stock/cash) | 29,718 | 8/29/2026 |
| Service‑based RSUs (stock/cash) | 21,988 | 8/30/2026 |
| Additional tranches | 20,726; 29,716; 20,724 | 8/27/2027; 8/29/2027; 8/27/2028 |
Note: FY2023 PSUs already certified/paid in Aug 2025; FY2024 and FY2025 PSU awards remain outstanding, presented at target until performance certified .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 519,233 shares (1.8% of outstanding) as of Aug 31, 2025 |
| Unvested RSUs (stock/cash) at 6/30/2025 | 234,480 units; market value $3,167,825 (@$13.51) |
| Unearned PSUs (target basis) at 6/30/2025 | 446,463 units; market value $6,031,715 (@$13.51) |
| Stock Ownership Guidelines | CEO: 5x base salary; met as of May 2025 |
| Hedging/Pledging | Prohibited; no margin accounts or pledging allowed |
| Share Delivery Cadence | Retirement‑eligible RSUs vest at 1 year but settle in 4 equal annual installments, creating multi‑year delivery profile |
Implication: Meaningful beneficial stake and strict hedging/pledging prohibitions support alignment; scheduled RSU settlements in 2026–2028 may create modest, predictable supply, though 10b5‑1 plans are permitted under policy .
Employment Terms
| Provision | CEO Terms |
|---|---|
| General Severance (no CoC) | 2x base salary; payable within timing limits; requires release |
| Change‑of‑Control (CoC) | Double‑trigger; 24‑month protection; 2x (base + target bonus); equity accelerates per plan |
| Potential Payments (as of 6/30/2025) | CoC + termination: Salary $1,600,000; STI $800,000; equity acceleration $9,039,122; Total $11,439,122 |
| Retirement acceleration (illustrative) | $5,676,834 equity acceleration value at 6/30/2025 pricing |
| Death/Disability acceleration | $9,039,122 equity acceleration value |
| Clawback | Adopted Aug 29, 2023; mandatory recoupment of erroneously awarded incentive comp upon restatement (3 prior FYs) |
| Insider Trading | Amended May 6, 2025; trading bans when MNPI unless under approved 10b5‑1 plan |
Board Governance
- Board Service and Roles: Director since May 2011; Strategy Committee Chair (formed Nov 2024) and Project Risk Committee member .
- Independence and Leadership: Not independent due to CEO role; Board Chair is independent (John D. Chandler); Chair/CEO roles separated; Audit/Comp/Nominating committees comprised solely of independents .
- Meetings/Structure: Board met 12 times in FY2025; five standing committees (Audit, Compensation, Nominating & Corporate Governance, Project Risk, Strategy); executive sessions held at least quarterly .
- Dual‑Role Implications: CEO as Strategy Chair centralizes transaction screening; mitigated by independent Board Chair and all‑independent key committees. Management directors receive no additional director pay .
Director/Shareholder Votes and Committee Oversight
- Say‑on‑Pay Support: 96% approval at 2024 meeting (committee considered feedback); 2025 advisory vote: For 20,132,922; Against 1,408,554; Abstain 50,754; broker non‑votes 4,233,591 .
- Compensation Committee: Members—Carlin G. Conner (Chair), Jose L. Bustamante, Martha Z. Carnes, Liane K. Hinrichs (independent); retained Meridian through Jan 2025 and moved to Pay Governance in Feb 2025; market targeting near 50th percentile .
- Benchmarking/Peers: Uses proxy peers for program design; PSUs tied to relative TSR vs a designated peer group (0–200% payout; cap at 1.5x if TSR negative) .
Performance & Track Record
| Metric | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|
| Company TSR (fixed $100 base) | 48.19 | 56.10 | 94.57 | 128.67 |
| Net Income (Loss) ($000) | (63,900) | (52,361) | (24,976) | (29,462) |
| Adjusted Operating Income (Loss) ($000) | (68,894) | (37,335) | (29,562) | (31,442) |
Recent operating signals (post‑FY2025):
- Q1 FY2026 revenue $211.9m (+28% YoY), adjusted EBITDA $2.5m, liquidity $248.9m with no debt, backlog $1.2bn; FY2026 revenue guidance reaffirmed at $875–$925m .
- Management commentary highlights improved direct gross margins near 10% target, organizational realignment benefits, and robust opportunity pipeline .
Execution Risk/Events:
- FY2025 results included charges from labor overruns on a crude terminal, arbitration reserve for a legacy project, adverse court decision re: subcontractor non‑payment, and restructuring costs .
Compensation Structure Analysis
- Mix and Risk: High at‑risk pay via PSUs (60% of CEO LTI) with 3‑year relative TSR focus; service RSUs split stock/cash to manage dilution and retention .
- Cash vs Equity Trends: CEO stock awards grant‑date fair value declined from $3.26m (FY2024) to $2.24m (FY2025); base salary unchanged since 2018 .
- Pay‑for‑Performance: No STI paid in FY2025 as financial thresholds were not met; PSUs for FY2023 cycle paid at 109% based on relative TSR .
- Governance Protections: Clawback policy; hedging/pledging prohibited; equity plan forbids option/SAR repricing without shareholder approval .
Investment Implications
- Alignment: Significant beneficial ownership (1.8%), CEO meets 5x salary ownership guideline, and strict anti‑hedging/pledging policy reinforce alignment with shareholders .
- Incentives: High PSU weighting (relative TSR) ties realized pay to shareholder returns; double‑trigger CoC (2x base+target bonus and equity acceleration) could be a transaction‑friendly incentive if strategic alternatives emerge .
- Retention/Succession: Severance provides stability (2x base); age 67 and retirement‑eligible status suggest medium‑term succession considerations; Nominating & Governance oversees CEO succession planning .
- Flow Overhang: 2026–2028 RSU settlements create predictable, staged share delivery; policy allows 10b5‑1 plans and prohibits pledging, which reduces disorderly selling risk .
- Execution Risk: FY2025 charges and legacy disputes underscore project‑level risk management importance; Board structure (independent Chair, Project Risk Committee) and CEO’s Strategy Committee role support oversight while preserving independent checks .
Overall: Strong ownership alignment and TSR‑linked LTI design offset short‑term earnings volatility. Improving revenues/margins and robust backlog under Hewitt’s “Win, Execute, Deliver” framework are constructive, while succession timing and project‑level legal/operational risks remain key watch‑items .
Citations:
- Governance/biography/committees: **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:11]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:13]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:14]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:17]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:18]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:21]**
- Compensation design/payouts/tables: **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:28]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:29]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:33]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:34]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:36]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:38]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:41]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:44]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:46]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:47]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:49]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:50]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:51]**
- Ownership/guidelines/hedge-pledge: **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:40]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:43]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:48]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:84]**
- Severance/CoC/Clawback: **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:40]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:51]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:52]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:53]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:54]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:78]**
- Say-on-pay/committee/peers: **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:16]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:30]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:32]** **[866273_0000866273-25-000081_mtrx-20251104.htm:1]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:38]**
- Performance/TSR/financials: **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:57]** **[866273_0001140361-25-036001_ny20052090x1_def14a.htm:58]** **[866273_0000866273-25-000098_a093025ex99earningsrelease.htm:0]** **[866273_4ec99f8277ef4306aaee0e64ab608f4f_4]** **[866273_0000866273-25-000066_a063025ex99earningsrelease.htm:4]** **[866273_0000866273-25-000066_a063025ex99earningsrelease.htm:1]** **[866273_436e8d8d57064c29b86426a3babae984_1]**