Tyson Foods’ execs score big raises and bonuses in 2014

Tyson Foods had a record year of earnings and $37.6 billion in sales in addition to pulling off the $8.5 billion acquisition of Hillshire Brands. Tyson Foods’ top management team was aptly rewarded with higher salaries and performance bonuses ranging from $3.102 million to $1.414 million.

The company’s executive pay schedule was recently outlined in its Proxy filing with the federal Securities and Exchange Commission.

CEO Donnie Smith earned a total compensation of $12.173 million in fiscal 2014, a gain of 23.3% from the $9.871 million earned in the prior year. Smith’s base salary of $1.092 million, increased 4.88% from the prior year, while the $2.38 million in stock awards were comparable to 2013. The real difference in 2014 pay was the $3.102 million performance bonus and $2.78 million in bonus stock options that total $5.159 million. This compared to $4.039 million in performance bonuses earned in 2013.

Other perquisites received by Smith in 2014 include:
• $35,444 for tax reimbursements;
• $46,484 for life insurance premiums;
• $27,303 company contribution to employee stock plan;
• $157,287 company contribution to executive savings plan;
• $10,400 company contribution to retirement account; and
• $108,682 for personal use of company-owned aircraft.

Tyson notes in the filing that Smith's total direct compensation was targeted between the 25th and 50th percentiles of the Compensation Peer Group for fiscal year 2014. Based on available published information, his actual total direct compensation for fiscal year 2014 was at the 75th percentile, primarily due to the performance incentive payments.

Jim Lochner retired from his post as chief operating office on Sept. 20, 2014. He earned $11.835 million in 2014, which included a performance bonus of $2.456 million paid to him on his last day of service. Lochner’s base salary totaled $1.019 million, a gain of 1.4% from the prior year.

The two executives to score the biggest annual raises were Donnie King, president of the Tyson’s North American operations and food service. King’s base salary totaled $784,046, up 31.4% from the prior year. The cash bonus rose to $1.808 million with stock option bonus awards of $1.564 million. In 2013, those payouts were $1.557 million and $479,780, respectively.

King’s total compensation rose to $6.7 million in fiscal 2014, an 86% increase from the prior year. King was promoted during early in fiscal 2014 and given more responsibilities which relates to the large compensation increase year-over-year.

The same is true for Noel White, who assumed the role of president for poultry in late 2013. White earned a total of $6.203 million in fiscal 2014, a gain of 74% year-over-year. White’s base salary increased to $711,114 last year, a gain of 28% from 2013. The bonus pay totaled $1.217 in cash and $1.04 million in stock options last year. That was higher than the $1.42 million cash bonus and stock options worth $497,780.

Chief Financial Officer Dennis Leatherby earned a base salary of $600,333 last year. That was a raise over the $571,729 he was paid in 2013. Leatherby received a cash bonus of $1.414 million and stock options worth $806,835. The cash bonus rose 5% form 2013 and the option awards nearly double the $454,664 paid two years ago.

Board Chairman John Tyson earned a 2014 base salary of $884,087, up 9.96% from 2013. His cash bonus was $2.48 million with another $1.739 million in stock options last year. His cash bonus declined from $3.102 in the prior year, stock options increased from $1.034 million. The chairman’s total compensation in 2014 was $8.846 million. His total pay has more than doubled since he earned $4.217 million in 2012.

The chairman’s other covered benefits totaled $1.361 million. That includes $859,129 for personal use of company-owned aircraft, and $175,196 for a retirement contribution. This also includes amounts for personal security and event tickets, according to the Proxy filing.