Richard M. Brooks
ZumiezAbout Richard M. Brooks
Richard M. Brooks (age 65) is Chief Executive Officer of Zumiez Inc. and a director; he has served as CEO since June 2000 after previously serving as Vice President and Chief Financial Officer from 1993 to 2000, with earlier finance roles at Interchecks, Inc. and Deloitte, Haskins & Sells; he holds a B.A. in Business from the University of Puget Sound . In fiscal 2024 (year ended Feb 1, 2025), Zumiez net sales rose to $889.2 million from $875.5 million (+2%), operating margin improved to 0.2% from -7.4%, and diluted EPS improved to a loss of $0.09 from a loss of $3.25, reflecting better product margin and cost controls amid returning comp growth . Governance structure separates CEO and Chair roles; the Chair (Thomas D. Campion) is non‑independent, and a Lead Independent Director (Travis D. Smith) leads executive sessions and independent director coordination; all board committees are fully independent .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Zumiez Inc. | Vice President and Chief Financial Officer | 1993–2000 | Finance leadership preceding CEO tenure; foundational knowledge of operations and strategy |
| Interchecks, Inc. (Bowater PLC subsidiary) | Finance Officer | 1989–1992 | Payments/financial operations experience |
| Deloitte, Haskins & Sells (now Deloitte LLP) | Various roles | 1982–1989 | Public accounting and advisory experience |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Stance, Inc. | Director | Not disclosed | Current board service |
| Brooks Foundation | Trustee | Not disclosed | Non-profit trustee role |
Board Governance and Service
- Current position: CEO and Director; not independent under Nasdaq rules .
- Board leadership: CEO and Chair roles are separated; Lead Independent Director (Travis D. Smith) convenes and presides over executive sessions of independent directors and coordinates agendas with CEO/Chair .
- Committee independence: All board committees (Audit, Compensation, Governance & Nominating) consist solely of independent directors; by policy, the CEO (non‑independent) does not serve on committees .
- Attendance: In fiscal 2024 the board met six times; all directors attended >75% of eligible board and committee meetings .
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary ($) | 735,000 | 735,000 | 735,000 |
| Bonus ($) | — | — | — |
| Non-Equity Incentive Plan Compensation ($) | — | — | 135,608 |
| All Other Compensation ($) | 5,487 | 5,081 | 6,652 |
| Total Compensation ($) | 740,487 | 740,081 | 877,260 |
- Pay ratio: CEO to median employee pay ratio was 130:1 for fiscal 2024 (median employee compensation $6,732; CEO total compensation $877,260) .
- Base salary governance: CEO base salary held flat at $735,000 in fiscal 2024 vs. fiscal 2023 .
Performance Compensation
- Short‑term cash‑based incentives structure (CEO):
- Metrics and weightings: North America net sales (24%), Other International net sales (6%), North America product margin (16%), Other International product margin (4%), Consolidated operating profit (50%); weights reflect CEO enterprise scope .
- Threshold‑to‑max payout schedule (as % of base salary): 63% / 125% / 188% / 219% / 250% tied to performance thresholds 1–5; payouts are multiplied by metric weightings achieved .
- 2024 results: Company exceeded threshold for North America net sales; did not achieve consolidated operating profit thresholds (others missed); CEO’s actual non‑equity incentive paid for 2024 was $135,608 (per Summary Compensation Table) .
- Clawback: Policy adopted Nov 28, 2023 requires recovery of erroneously awarded incentive compensation for the three fiscal years preceding any required accounting restatement .
- Long‑term equity:
- The Compensation Committee determined the CEO and Chairman already hold sufficient equity; neither has received equity grants since before the IPO; 2024 equity grants were made to other NEOs only .
- Equity grant design for NEOs includes stock options (10‑year term; 25% vest annually) and restricted stock (33% vest annually) with annual grant timing post year‑end results; CEO received none in 2024 .
2024 Incentive Design Details (CEO)
| Metric | Weighting | Thresholds Framework | Notes |
|---|---|---|---|
| North America Net Sales Growth | 24% | Multi‑level thresholds (with target and stretch) | Level 1 threshold achieved in 2024 for NA net sales |
| Other International Net Sales Growth | 6% | Multi‑level thresholds | Not achieved in 2024 |
| North America Product Margin Improvement | 16% | Last year plus specified bps | Not achieved in 2024 |
| Other International Product Margin Improvement | 4% | Last year plus specified bps | Not achieved in 2024 |
| Consolidated Operating Profit (Dollar Improvement) | 50% | Multi‑level thresholds | Not achieved in 2024 |
Equity Ownership & Alignment
| Ownership Item | Detail |
|---|---|
| Beneficial Ownership | 2,647,954 common shares (13.5% of outstanding) as of March 26, 2025 |
| Vested vs. Unvested | No outstanding unvested restricted stock or options listed for the CEO at FY24 year‑end; indicates holdings are largely outright shares (no CEO awards shown in outstanding awards table) |
| Options (Exercisable/Unexercisable) | None listed for CEO at FY24 year‑end |
| Hedging/Pledging | Hedging transactions and derivative trades require prior written consent and are generally prohibited; pledging and margin accounts are prohibited by policy |
| Ownership Guidelines | Company emphasizes “shareholder mentality” and has not adopted formal executive share ownership requirements given historically substantial insider holdings |
Insider trading controls include defined open windows, blackout restrictions, and 10b5‑1 usage parameters under the insider trading policy .
Employment Terms
| Term | Disclosure |
|---|---|
| Employment Agreement | None; all U.S. employees (including executives) are at‑will |
| Severance | No severance or separation plan for executive officers |
| Change‑of‑Control | Double‑trigger equity acceleration: if awards are assumed/replaced at a change‑in‑control, vesting accelerates only upon qualifying termination within 1 year post‑CoC |
| Clawback | Restatement‑based recovery policy adopted Nov 28, 2023 |
| Tax Gross‑Ups | No 280G/4999 or 409A gross‑ups; compensation structured to comply with 409A |
| Pension/Deferred Comp | No defined benefit pension or nonqualified deferred compensation plans |
Performance & Track Record
| Metric | FY 2023 | FY 2024 | Commentary |
|---|---|---|---|
| Net Sales ($000s) | 875,486 | 889,202 | +2% YoY; comps +4.0%; apparel led growth |
| Operating Profit (Loss) ($000s) | (64,789) | 1,950 | Turned positive; +$66.7m improvement YoY |
| Operating Margin (%) | -7.4% | 0.2% | Improved with higher product margin and SG&A control |
| Diluted EPS ($) | (3.25) | (0.09) | Improved; tax rate dynamics noted |
Key 2024 operating notes: record product margin ex‑stimulus year, gross margin +200 bps to 34.1%, and cost reductions versus fiscal 2023; balance sheet strength with $147.6 million in cash and marketable securities and no debt entering fiscal 2025 .
Compensation Committee Analysis (context)
- Committee members (FY 2024): Scott A. Bailey (Chair), Steven P. Louden, James P. Murphy; all independent .
- Independent consultant: Meridian Compensation Partners advised on market analysis and design; assessed as independent by the committee .
- Benchmarking peer group included: Abercrombie & Fitch, American Eagle Outfitters, Buckle, Cato, Citi Trends, Duluth Holdings, Five Below, Genesco, Hibbett Sports, Lands’ End, Sportsman’s Warehouse, Tilly’s, Urban Outfitters, Vera Bradley .
- Pay positioning: base salaries near 40th percentile; total cash and equity around 50th percentile; exception for CEO/Chair equity due to significant ownership stakes and no grants since IPO .
Say‑on‑Pay & Shareholder Feedback
- 2024 say‑on‑pay approval: 96.6% of votes cast supported NEO compensation .
- Frequency: Shareholders supported annual say‑on‑pay in 2023; board continues to hold annual advisory votes .
Related Party Transactions and Red Flags
- Related party policy requires Audit Committee review; no 2024 charitable contributions to the Zumiez Foundation (Chairman is Foundation Chair) .
- Risk controls: anti‑hedging/anti‑pledging policy; clawback; independent committees; capped incentive upside (CEO max 250% of base) .
Investment Implications
- Alignment: Very high insider ownership by the CEO (13.5%) aligns incentives with long‑term value creation; absence of recent equity awards and no outstanding CEO equity reduces forced‑selling/vesting overhang risk near‑term .
- Incentive quality: Cash incentive design emphasizes revenue growth, product margin, and consolidated operating profit with significant weight (50%) on profitability; clawback and caps mitigate risk‑taking; 2024 payout was modest relative to base, indicating discipline in pay‑for‑performance .
- Retention/transition: At‑will employment with no severance plan and double‑trigger equity could imply lower change‑in‑control costs but modestly higher retention risk absent fresh equity for the CEO; however, the CEO’s substantial outright ownership provides powerful retention/engagement incentives .
- Governance: Independent committee structure, separated Chair/CEO, and a Lead Independent Director support oversight; strong recent say‑on‑pay support reduces governance overhang risk .