Tyson Foods chairman and CEO earned more in 2017, other execs earn less

Tyson Foods had a record year of profits, while the stars were mostly aligned for most protein manufacturers last year. Tom Hayes, who was named president of the company in June 2016, added the title of CEO on Jan. 1 this year, following the retirement of Donnie Smith. Hayes was also added to the company’s board of directors in November 2016.

Hayes earned total compensation of $8.905 million in fiscal 2017, ended Sept. 30, an increase of 90% over his earnings the prior year when he served as second in command for the meat giant. To put Hayes’ salary in perspective with his predecessor,  total 2017 compensation was below the $11.471 million Smith earned in fiscal 2016, according to the filing made with the U.S. Securities and Exchange Commission early Wednesday (Dec. 20).

The base salary for Hayes totaled $1.104 million, up from $712,954 he earned the prior year when he worked under Smith. Hayes was one of two top executives to get larger bonuses last year. He received non-equity compensation of $2.103 million, up from $1.519 million earned the prior year. Stock awards totaled $3.886 million, up from $1.032 million earned a year ago. His pension benefits totaled $308,318, down slightly from last year. All other compensation totaled $315,029, up substantially from the prior year because of increased usage of corporate jets ($220,140) and moving expenses of $47,000, according to the filing.

Chief Financial Officer Dennis Leatherby is set to retire in early 2018. Leatherby, who has held the job for nearly a decade, will make his exit in early February after 28 years with Tyson Foods. He saw his total compensation decrease in fiscal 2017 with combined earnings of $3.969 million, down from $4.314 million in the prior year and $4.477 million in fiscal 2015. Base salary increased 5.4% to $696,470 in 2017. Stock awards increased slightly to $1.384 million as did option awards of $423,025. Leatherby did collect a smaller cash bonus last year totaling $975,954, down from $1.279 million the prior year. His other total compensation also fell to $169,200, from $304,134 the year before. Much of that decline related to less travel on the corporate jet than in prior years.

Stewart Glendinning recently joined Tyson from Molson Coors on Dec. 11 as Leatherby’s replacement. The 52-year-old Glendinning garnered a sign-on bonus of $2.7 million and agreed to a base salary of $725,000, around 4% higher than Leatherby’s ending base salary.

Noel White, also a Tyson Foods veteran, changed jobs a couple of times in fiscal 2017. He began the year as chief operating officer, but with a complete corporate restructure a few months into Hayes’ first year as CEO, White was moved to manage the company’s beef and pork businesses as president of fresh meats and international. White’s total earnings were $5.985 million in 2017, down from $6.02 million the prior year. His base salary rose to $835,786, up 7.46% year over year.

The biggest reason for the earnings decline was a decrease in cash bonus pay. White earned $1.402 million in cash bonuses last year, down from $1.781 million the prior year. His pension contributions from the company also were considerably less last year at $516,918, down from $917,108 in 2016. White saw an increase in stock awards totaling $2.256 million last year while other compensation and option awards were on par with the pay from 2016.

Board chairman and grandson of the founder, John Tyson, saw his total earnings improve in fiscal to $10.453 million, up 5.11% from the prior year. Tyson’s base salary improved to $937,587 from $928,818 a year ago. His stock awards rose to $4.099 million, and option awards stayed the same at $1.252 million. Tyson’s cash bonus pay totaled $1.813 million, down from $2.448 million in 2016. His pension pay rose to $575,251 up from $183,113 and all other compensation totaled $1.789 million, up slightly from $1.734 million in the prior year.

Donnie Smith, who was on a retainer as a consultant with the company last year, earned a total of $5.071 million. Smith remains under contract with Tyson Foods for two more years, with guaranteed earnings of $2.3 million annually.

Tyson Foods’ board noted in the filing, “Our executive compensation program is rooted in maintaining a strong link between pay and performance, which we believe results in a better alignment of compensation with corporate goals and shareholder interests. Through our executive compensation program, we emphasize attainment of company goals, both short- and long-term, and seek to foster a commitment to performance that enhances sustainable shareholder value.”

Last year Tyson Foods reported total revenue of $38.3 billion and operating income of $2.9 billion, up 3.5% over 2016. The board also said it increased dividends to shareholders by 50% last year.

On Wednesday, Tyson Foods shares (NYSE: TSN) were trading at $81.33, off the $84.65 high set earlier this month. Since Jan. 1, shares have risen from 62.58, a 29.9% year-to-day gain in price.

Also in the filing, Tyson Foods said it will hold its annual shareholder meeting on Feb. 8 in Springdale. Shareholders will elect a board of 11 directors, and vote on two shareholder proposals related to more transparency in the company’s corporate lobbying efforts, as well as a proposal on better water stewardship programs of Tyson Foods and its suppliers.

The company’s board is against both resolutions.