Garth Hankinson
CONSTELLATION BRANDSAbout Garth Hankinson
Garth Hankinson is Executive Vice President and Chief Financial Officer of Constellation Brands, appointed effective January 13, 2020; he previously served ~18 years in corporate development roles at STZ and earlier spent 8+ years in strategy/finance roles at Xerox and Citi . At appointment, his age was 51 (Dec 2019) . STZ’s incentive design links pay to Net Sales, Comparable EBIT, and Free Cash Flow; in FY2025 the company achieved ~96% of Net Sales target, ~98% of Comparable EBIT, and ~126% of FCF, resulting in AMIP payouts ~72% of target for consolidated executives (incl. CFO) . Pay-versus-performance shows FY2025 TSR value of an initial $100 investment at $109.82 versus $154.77 for the S&P 500 Food, Beverage & Tobacco Index, alongside Net Sales of $10,208.7 million and Net Income (Loss) of $(31.1) million .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Constellation Brands | SVP, Corporate Development | Feb 2016–Jan 2020 | Led FP&A, reporting/analysis; M&A, ventures, strategic alliances across beer, wine & spirits . |
| Constellation Brands | VP, Corporate Development | Oct 2009–Feb 2016 | Corporate development; capital allocation support . |
| Constellation Brands Canada (prior subsidiary) | VP, Business Development | Oct 2007–Oct 2009 | Business development in Canadian operations . |
| Constellation Brands | Director, Corporate Development | Mar 2004–Oct 2007 | Corporate development leadership . |
| Constellation Brands | Manager, Corporate Development | Oct 2001–Mar 2004 | Corporate development, early career . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Xerox | Strategy/Finance roles | 8+ years prior to 2001 | Corporate finance/strategy experience . |
| Citi | Strategy/Finance roles | 8+ years prior to 2001 | Financial services strategy/finance experience . |
Fixed Compensation
Base Salary (Summary Compensation Table)
| Metric | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Salary ($) | $748,000 | $778,746 | $815,769 |
FY2025 Base Rate and Target Bonus
- Base salary rate: $825,000 (+5.1% YoY) .
- Target AMIP bonus: 100% of base salary .
Perquisites & Other Compensation (FY2025)
| Component | Amount ($) |
|---|---|
| Company contributions (401(k) & Profit Sharing Plan) | $23,608 |
| Company contributions (NQSP) | $43,686 |
| Perquisites & Other Personal Benefits | $130,894 (incl. corporate aircraft personal use $55,324) |
| Total “All Other Compensation” | $198,188 |
Performance Compensation
Annual Management Incentive Plan (AMIP) – FY2025
| Metric | Target | Actual | Attainment | Notes |
|---|---|---|---|---|
| Net Sales | Board-approved plan | $10,208.7m | 96.0% | Company-selected measure (CSM) . |
| Comparable EBIT | Board-approved plan | $3,497.9m | 98.4% | Key annual measure . |
| Free Cash Flow (FCF) | Board-approved plan | $1,938.1m | 125.9% | Outperformed; drove payout . |
| Resulting payout | 100% of base for CFO | $583,634 | 71.6% of target | Consolidated executives received ~72% . |
Long-Term Equity Incentive Awards (granted 4/25/2024; FY2025 LTSIP mix)
| Award Type | Grant Date | Shares/Units | Grant-date Fair Value ($) | Vesting | Performance Metrics |
|---|---|---|---|---|---|
| PSUs | 4/25/2024 | Threshold: 2,198; Target: 4,395; Max: 8,790 | $1,289,251 | Satisfy 3-year performance; service vest May 1, 2027 | 50% relative TSR vs S&P 500 F,B&T; 50% organic net sales CAGR; thresholds 25th percentile TSR and 6% CAGR; target 50th percentile TSR and 7% CAGR; max 75th percentile TSR and 8% CAGR . |
| RSUs | 4/25/2024 | 2,637 | $690,129 | Time-based; 33% per year at each of first three anniversaries of May 1, 2024 | Retention and value alignment . |
| NQSOs | 4/25/2024 | 5,521 | $460,120 | 33% per year over three years; 10-year term to 4/25/2034; strike $261.71 | Pay-for-appreciation only . |
PSU outcome signals: FY2023–FY2025 relative TSR PSU program certified at ~16th percentile; no PSUs earned under that cycle . FY2024 and FY2025 PSU tranches are currently tracking at target/threshold as of FY2025 performance but require continued service to May 1, 2026/2027, with final outcomes variable .
Option Exercises and Stock Vested (FY2025)
| Item | Amount |
|---|---|
| Options exercised | 33,680 shares; value realized $2,590,094 |
| Stock awards vested (RSU/PSU) | 4,387 shares; value realized $1,147,929 |
Equity Ownership & Alignment
Beneficial Ownership (Record Date; Class A and Class 1)
| Class | Shares Beneficially Owned | Notes |
|---|---|---|
| Class A | 13,799 | Percentage not exceeding 1% . |
| Class 1 (acquirable within 60 days via options) | 37,419 | 57.9% of Class 1 outstanding due to small float calculation method . |
Outstanding Equity Awards (as of Feb 28, 2025)
| Grant Date | Type | Exercisable Options | Unexercisable Options | Strike ($) | Expiration | Unvested RSUs (units; MV $) | Unearned PSUs (units; Payout MV $) |
|---|---|---|---|---|---|---|---|
| 4/20/2021 | NQSO | 10,548 | 3,516 | 238.31 | 4/20/2031 | 450; $78,975 | — |
| 4/21/2022 | NQSO | 10,190 | 10,190 | 254.21 | 4/21/2032 | 1,509; $264,830 | — |
| 4/24/2023 | NQSO | 3,115 | 6,228 | 224.38 | 4/24/2033 | 2,736; $480,168 | 6,839; $1,200,245 |
| 4/25/2024 | NQSO | — | 5,521 | 261.71 | 4/25/2034 | 2,637; $462,794 | 2,198; $385,749 |
- Stock ownership guidelines for Executive Vice Presidents: 3x base salary; compliance assessed at least annually. As of the Record Date, each NEO met guidelines or was within the five-year accumulation period .
- Hedging and pledging: Hedging prohibited; pledging prohibited for executive officers, with carve-out only for certain Sands family nominees; CGNR Committee monitors compliance .
Employment Terms
Employment Agreement & Severance
- Agreement effective Jan 13, 2020; auto-renews annually unless 180 days’ notice of non-renewal .
- Initial base salary $575,000 (adjustable by Committee) .
- Severance upon good reason or termination without cause: lump-sum equal to 2× base salary + 2× average annual bonus over prior 3 fiscal years; 24 months medical/dental; up to 18 months outplacement .
- As of Feb 28, 2025 qualifying termination severance: $3,472,835 severance pay; $49,206 medical/dental; $55,000 outplacement; total $3,577,041 .
- Non-compete: 2 years; Non-solicit: 12 months; confidentiality covenants .
Change-in-Control and Equity Vesting
- Double-trigger: If awards are assumed/replaced, full vesting at target for PSUs; full vesting and delivery for RSUs; NQSOs fully vested/exercisable for 90 days following termination within 24 months post-CIC .
- Equity acceleration values as of Feb 28, 2025: $3,788,168 (CIC), $3,788,168 (death/disability); retirement treatment not applicable for Hankinson at that date .
- AMIP pro-ration upon retirement, disability, death, or involuntary termination without cause; forfeiture otherwise .
Governance Protections
- Clawback policy (April 2023) compliant with Dodd-Frank: mandatory recovery of erroneously awarded incentive comp for 3 years preceding restatement, regardless of cause .
- No excise tax gross-ups; “best net” approach for 280G .
- Related party transactions: none requiring disclosure for Hankinson at appointment .
Investment Implications
- Pay-for-performance alignment: AMIP linked to Net Sales/Comparable EBIT/FCF and PSU mix at 50% with rigorous TSR/net sales CAGR hurdles; FY2023–FY2025 TSR PSUs paid zero, evidencing discipline when relative performance underwhelms .
- Retention risk: Strong equity weighting (PSUs/RSUs/NQSOs) with service vest dates (RSUs annually each May 1; PSUs May 1, 2027) and double-trigger CIC protections; severance at 2× salary+bonus is competitive but not excessive, reducing flight risk without overpaying .
- Trading signals: Class 1 options require conversion to Class A upon exercise with immediate sale, and FY2025 saw $2.59m value realized on option exercises; upcoming annual option/RSU vest anniversaries (around late April/May 1) can create mechanical selling pressure and supply into the market .
- Alignment safeguards: 3× salary ownership guideline compliance, bans on hedging/pledging, and robust clawback reduce governance red flags; say-on-pay support was ~97% in 2024, indicating shareholder endorsement of program design .