DEF: Hawkins, Inc. Sets Annual Shareholder Meeting Agenda, Highlights Strong Fiscal 2025 Performance and Executive Compensation Approvals

Sentiment:

Proxy Statement 18 June 2025 8:13 AM

Hawkins, Inc. announced its upcoming virtual Annual Meeting of Shareholders on July 30, 2025, where shareholders will vote on director elections, auditor ratification, and executive compensation, following a fiscal year marked by strong financial performance exceeding targets.

Delay expectedLate Form 4 filings for Richard G. Erstad, Drew M. Grahek, Patrick H. Hawkins, Douglas A. Lange, David J. Mangine, Jeffrey P. Oldenkamp, and Shirley A. Rozeboom, reporting one transaction relating to the forfeiture of shares to satisfy tax withholding obligations in connection with vesting, filed on April 14, 2025.Late Form 3 filing for Gregory A. Jones reporting beneficial ownership, solely as a result of delays in obtaining filing credentials, filed on May 9, 2025.

Better than expectedIncome before income taxes for fiscal 2025 was $114,383,000, exceeding the target of $105,537,000.Named executive officers received 142% of their targeted payout for non-equity incentive compensation based on corporate performance.Performance-based restricted stock units were earned at 121% of target.The Health & Nutrition Group's operational performance measure was $18,139,000, surpassing its target of $15,822,000, leading to a 173% payout for Ms. Rozeboom's business unit incentive.

Summary

The Annual Meeting of Shareholders of Hawkins, Inc. is scheduled for Wednesday, July 30, 2025, at 8:00 a.m., Central Time, and will be held completely virtually.
Shareholders will vote on three key items: the election of eight directors, the ratification of Deloitte & Touche LLP as the independent registered public accounting firm for the fiscal year ending March 29, 2026, and a non-binding advisory vote to approve the compensation of named executive officers.
For fiscal year 2025, the company reported income before income taxes of $114,383,000, surpassing the target performance level of $105,537,000.
This strong corporate performance resulted in named executive officers receiving 142% of their targeted payout under the annual non-equity incentive compensation arrangement.
Performance-based restricted stock units for executive officers were earned at 121% of target, also based on the company's income before income taxes.
Ms. Shirley A. Rozeboom, Vice President Health & Nutrition, achieved 173% of her targeted payout for her business unit's operational profitability, which reached $18,139,000 against a target of $15,822,000.
Base salaries for named executive officers were increased, with CEO Patrick H. Hawkins's salary rising 10% to $700,000 and CFO Jeffrey P. Oldenkamp's increasing 22% to $570,000, attributed to labor market dynamics.
The company dismissed Grant Thornton LLP as its independent registered public accounting firm effective May 14, 2025, after completing the fiscal 2025 audit, and appointed Deloitte & Touche LLP for fiscal 2026.
The CEO pay ratio for fiscal 2025 was 34 to 1, with the CEO's total compensation reported as $3,151,261 and the median employee's total compensation as $93,679.

Sentiment

Score: 8

Explanation: The document presents strong financial performance for fiscal 2025, with key metrics exceeding targets, leading to higher executive incentive payouts. It also highlights robust corporate governance practices and high shareholder approval for compensation. The only minor negative is a few late Section 16(a) filings, which are explained and do not detract significantly from the overall positive outlook.

Positives

Strong financial performance in fiscal 2025, with income before income taxes reaching $114,383,000, exceeding the target by approximately 8.4%.
Executive compensation payouts for non-equity incentives were 142% of target for most named executive officers, reflecting successful achievement of corporate performance goals.
Performance-based restricted stock units were earned at 121% of target, indicating effective alignment of long-term incentives with company performance.
The Health & Nutrition Group demonstrated exceptional performance, achieving 173% of its operational profitability target, highlighting strength in a key business segment.
High shareholder approval (approximately 95%) for executive compensation at the previous annual meeting, indicating strong investor confidence in the company's compensation philosophy and overall management.
The Board maintains robust corporate governance practices, including a separation of the CEO and Chair roles, and fully independent Audit, Compensation, and Governance and Nominating Committees.
The company has adopted a clawback policy for incentive-based compensation and maintains strict insider trading and hedging prohibitions, enhancing corporate accountability and risk management.

Negatives

Several executive officers and one new director had late Section 16(a) reports filed, indicating minor compliance delays, although reasons were provided (tax withholding obligations and delays in obtaining filing credentials).

Risks

Operational risks, which are monitored by the Board of Directors.
Market risks, which are monitored by the Board of Directors.
Liquidity risks, which are monitored by the Board of Directors.
Legal risks, which are monitored by the Board of Directors.
Cybersecurity risks, which are specifically overseen by the Audit Committee.
Regulatory risks, which are monitored by the Board of Directors.
Risks arising from compensation policies and practices, though management concluded they are not reasonably likely to have a material adverse effect on the company.

Future Outlook

The document primarily focuses on past fiscal year performance and upcoming shareholder meeting agenda, with no explicit forward-looking financial guidance or strategic outlook beyond the general objective of achieving long-term success and growth in shareholder value through the executive compensation program.

Management Comments

"Our executive compensation program is designed to attract and retain executives who will lead our company to achieve long-term success and growth in shareholder value."
"The Compensation Committee and the other members of our Board believe that this vote reflected our shareholders strong support of the compensation decisions made by the Committee for our named executive officers for fiscal 2024."
"Management prepared an analysis of our compensation policies and practices and concluded that they do not create risks that are reasonably likely to have a material adverse effect on our company."

Industry Context

The document highlights Hawkins, Inc.'s strong financial performance in fiscal 2025, particularly in income before income taxes and the Health & Nutrition segment's operational profitability. This suggests the company is performing well within its industry, potentially outperforming competitors given the significant achievement of incentive targets. The use of the Nasdaq Industrial Index as a peer group for Total Shareholder Return (TSR) comparison indicates the company operates within a broad industrial sector, and its performance metrics should be viewed in that context. The company's ability to increase executive salaries due to 'labor market dynamics' suggests a competitive environment for talent within its sector.

Comparison to Industry Standards

The company uses the Nasdaq Industrial Index as its peer group for Total Shareholder Return (TSR) comparison, indicating its performance is benchmarked against a broad industrial sector.
The document does not provide specific comparable companies or projects to assess results against global benchmarks, but it does state that the Compensation Committee reviews survey data to understand current compensation practices, levels, and structures, without explicitly benchmarking its compensation.
The company's income before income taxes of $114,383,000 for fiscal 2025, exceeding its target of $105,537,000, suggests strong internal performance relative to its own operational plans.
The Health & Nutrition Group's operational profitability of $18,139,000, significantly above its $15,822,000 target, indicates robust performance within that specific segment, which could be a competitive advantage.

Corporate Governance

Change Type	Description	Effective Date	Impact Assessment
Board Composition	Eight directors are nominated for re-election to the Board, maintaining the current board size and composition.	July 30, 2025	Ensures continuity and leverages existing expertise; all nominated directors are current members.
Meeting Format	The Annual Meeting of Shareholders will be completely virtual, incorporating technology to increase efficiency and shareholder participation.	July 30, 2025	Enhances accessibility for shareholders and potentially reduces logistical costs for the company.
Leadership Structure	The roles of Chief Executive Officer and Chair of the Board remain separate, with Mr. Thompson serving as Chair, allowing for greater active participation of directors in setting agendas and priorities.	Ongoing	Promotes independent oversight of management and strengthens the Board's strategic direction.
Committee Independence	All members of the Audit, Compensation, and Governance and Nominating Committees are determined to be independent directors.	Ongoing	Ensures objective decision-making and adherence to best practices in financial oversight, executive compensation, and director nominations.
Clawback Policy	A clawback policy was adopted in compliance with SEC Rule 10D-1 and Nasdaq rules, requiring recovery of erroneously awarded incentive-based compensation due to accounting restatements.	October 2, 2023	Reinforces integrity and accountability in compensation practices, aligning executive pay with accurate financial reporting.
Insider Trading and Hedging Policies	The company maintains an insider trading policy prohibiting trading while aware of material non-public information and prohibits directors, officers, and employees from hedging company equity securities or pledging them as collateral.	Ongoing	Promotes compliance with securities laws, reduces potential conflicts of interest, and aligns management's financial interests with long-term shareholder value.

Related Party Transactions

The company employs Katherine Maki (daughter of CEO Patrick H. Hawkins), Macy Pollgreen (daughter of VP Shirley A. Rozeboom), and Riley Segura (daughter of VP Shirley A. Rozeboom). The total compensation received by any of these individuals did not exceed $245,000 for fiscal 2025.
Stauber Performance Ingredients, Inc., a wholly-owned subsidiary, leases its corporate office building and warehouse from an entity partially owned by Daniel J. Stauber, a Board member and Chief Brand Officer. The rent expense paid in fiscal 2025 totaled $0.6 million, of which approximately $72,000 was attributable to Mr. Stauber. These transactions were reviewed and ratified in advance by the Audit Committee.

Stakeholder Impact

**Shareholders**: Directly impacted by the opportunity to vote on key governance matters (director elections, auditor ratification, executive compensation) and benefit from the company's strong financial performance, which drives shareholder value. The virtual meeting format aims to increase participation.
**Executive Officers**: Directly impacted by the executive compensation program, which provided higher payouts due to exceeding performance targets and includes base salary increases. They are also subject to strict governance policies like clawbacks and insider trading prohibitions.
**Employees**: Benefit from competitive compensation practices, including base salary adjustments due to labor market dynamics, and participation in various retirement plans (401(k), Profit Sharing Plan, ESOP, nonqualified deferred compensation plan). The median employee compensation and CEO pay ratio are disclosed for transparency.
**Customers and Suppliers**: Indirectly impacted by the company's financial stability and strategic direction, which are overseen by a well-governed Board and effective management, potentially leading to more reliable partnerships and product offerings.
**Regulatory Authorities**: The company demonstrates compliance with SEC and Nasdaq rules through its detailed proxy disclosures, adoption of a clawback policy, and reporting of Section 16(a) filings, even noting minor delays.

Next Steps

The Annual Meeting of Shareholders will be held on July 30, 2025, for voting on directors, auditor ratification, and executive compensation.
Deloitte & Touche LLP will serve as the independent registered public accounting firm for the fiscal year ending March 29, 2026.
Shareholder proposals (other than director nominations) to be considered for inclusion in next year's proxy statement must be received by February 18, 2026.
Other shareholder proposals (including director nominations) to be properly brought before next year's annual meeting must be received by May 1, 2026.
Shareholders intending to solicit proxies in support of director nominees must provide notice by June 1, 2026, to comply with universal proxy rules.
Restricted stock granted to non-employee directors on July 31, 2024, is scheduled to vest on July 31, 2025.
Shares of restricted stock issued for fiscal 2024 performance will vest on March 30, 2026.
Shares of restricted stock issued for fiscal 2025 performance will vest on March 29, 2027.

Key Dates

Date	Description
1974	James T. Thompson began various positions at Cargill, Inc.
1979	Mary J. Schumacher began various positions at The Pillsbury Company.
1984	Daniel J. Stauber began various positions with Stauber Performance Ingredients, Inc.
1984	Jeffrey L. Wright was employed by Arthur Andersen & Co.
1992	Patrick H. Hawkins joined Hawkins, Inc.
1992	Mary J. Schumacher began various positions at Ecolab Inc.
1993	Jeffrey L. Wright began various positions at Employee Benefit Plans, Inc.
1994	Daniel J. Stauber became President of Stauber Performance Ingredients, Inc.
1996	Jeffrey L. Wright became Controller at BMC Industries, Inc.
1996	James T. Thompson became President of Cargill Steel.
1998	Jeffrey L. Wright became Treasurer at BMC Industries, Inc.
1998	Daniel J. Stauber became Chief Executive Officer of Stauber Performance Ingredients, Inc.
1999	Jeffrey L. Wright became Chief Financial Officer of G&K Services, Inc.
1999	Jeffrey E. Spethmann became General Manager and President of Blow Molded Specialties, Inc.
2002	Patrick H. Hawkins became Sales Representative Food Ingredients at Hawkins, Inc.
2003	Mary J. Schumacher became Senior Vice President, Research, Technology, Quality and Engineering at Andersen Corporation.
2004	James T. Thompson became Executive Vice President Commercial of The Mosaic Company.
2004	Jeffrey L. Wright became Senior Vice President at G&K Services, Inc.
2006	James A. Faulconbridge became President of Karges-Faulconbridge, Inc.
2006	James A. Faulconbridge first elected as a director of Hawkins, Inc.
2007	Patrick H. Hawkins became Business Manager Food and Co-Extrusion Products at Hawkins, Inc.
2008	Mary J. Schumacher became Senior Vice President and General Manager at Andersen Corporation.
2009	Patrick H. Hawkins became Business Director Food and Pharmaceuticals at Hawkins, Inc.
2009	James T. Thompson first elected as a director of Hawkins, Inc.
2009	Jeffrey L. Wright first elected as a director of Hawkins, Inc.
2009	Jeffrey L. Wright became Executive Vice President and Director at G&K Services, Inc.
2010	Patrick H. Hawkins became President of Hawkins, Inc.
2010	Mary J. Schumacher became Chief Operating Officer of Twin Cities Habitat for Humanity.
2010	Yi "Faith" Tang began various positions at H.B. Fuller Company.
2011	Patrick H. Hawkins became Chief Executive Officer of Hawkins, Inc.
2011	Patrick H. Hawkins first elected as a director of Hawkins, Inc.
August 2, 2011	Effective date for definition of 'continuing director' in Executive Severance Plan.
2012	Mary J. Schumacher first elected as a director of Hawkins, Inc.
April 1, 2012	Cut-off date for eligibility to participate in nonqualified deferred compensation plan.
2013	Jeffrey E. Spethmann joined Donaldson Company, Inc.
2014	Jeffrey L. Wright retired from G&K Services, Inc.
2015	Hawkins, Inc. acquired Stauber Performance Ingredients, Inc.
2016	Mary J. Schumacher retired from Twin Cities Habitat for Humanity.
2016	Daniel J. Stauber first elected as a director of Hawkins, Inc.
April 2016	Jeffrey E. Spethmann became Senior Vice President of Industrial Products of Donaldson Company, Inc.
2018	Daniel J. Stauber served as Vice President Health and Nutrition and as President of Stauber Performance Ingredients, Inc.
2019	Daniel J. Stauber concluded his role as Vice President Health and Nutrition and as President of Stauber Performance Ingredients, Inc.
March 27, 2020	Last trading day of fiscal year 2020, used as base for TSR calculation.
2020	Yi "Faith" Tang first elected as a director of Hawkins, Inc.
2021	Jeffrey E. Spethmann first elected as a director of Hawkins, Inc.
September 2021	Yi "Faith" Tang became Global Chief Information Officer and Chief Digital Officer of MiTek, Inc.
October 2, 2023	Effective date for clawback policy application to incentive-based compensation.
October 2023	Yi "Faith" Tang became Chief Information Officer of Mortenson Construction.
October 2023	Jeffrey E. Spethmann concluded his role as Senior Vice President of Industrial Products of Donaldson Company, Inc.
December 31, 2023	Date used to identify median employee for CEO pay ratio and for beneficial ownership reporting by BlackRock, Inc. and The Vanguard Group.
January 2024	Jeffrey E. Spethmann became Chief Executive Officer of HydrogenPro, Inc.
January 15, 2024	Date used to determine employee population for CEO pay ratio.
January 22, 2024	Schedule 13G/A filed by BlackRock, Inc.
February 13, 2024	Schedule 13G/A filed by The Vanguard Group.
April 1, 2024	Fiscal 2022 performance-based stock awards vested.
May 2024	Effective date for base salary increases for Mr. Erstad, Mr. Grahek, and Ms. Rozeboom.
May 15, 2024	Grant date for plan-based awards to named executive officers for fiscal 2025.
July 31, 2024	Date non-employee directors were granted 962 shares of restricted stock.
August 2024	Previous annual meeting of shareholders where 95% of advisory votes supported executive compensation.
March 28, 2025	Last business day of fiscal 2025, used for common stock closing price ($106.14/share) for valuation of equity awards.
March 29, 2025	End of fiscal year 2025 for which Deloitte & Touche LLP is appointed auditor.
March 30, 2025	End of fiscal year 2025 for outstanding equity awards and equity compensation plan information.
March 31, 2025	Vesting date for shares of restricted stock issued for fiscal 2023.
April 14, 2025	Date of late Form 4 filings for several executive officers.
April 2025	Jeffrey E. Spethmann became Chief Executive Officer of Phillips & Temro Industries.
May 9, 2025	Date of late Form 3 filing for Gregory A. Jones.
May 14, 2025	Effective date of dismissal of Grant Thornton as independent registered public accounting firm.
June 6, 2025	Record date for determining shareholders entitled to vote at the Annual Meeting.
June 18, 2025	Date of the Proxy Statement and expected mailing of Notice of Internet Availability of Proxy Materials.
July 30, 2025	Date of the Annual Meeting of Shareholders.
July 31, 2025	Vesting date for restricted stock granted to non-employee directors on July 31, 2024.
February 18, 2026	Deadline for shareholder proposals (other than director nominations) to be considered for inclusion in next year's proxy statement.
March 29, 2026	End of fiscal year 2026, for which Deloitte & Touche LLP is appointed auditor.
March 30, 2026	Vesting date for shares of restricted stock issued for fiscal 2024.
May 1, 2026	Deadline for other shareholder proposals (including director nominations) to be properly brought before next year's annual meeting.
June 1, 2026	Deadline for shareholders to provide notice for soliciting proxies for director nominees under universal proxy rules for next year's annual meeting.
March 29, 2027	Vesting date for shares of restricted stock issued for fiscal 2025.

Recommendation

buy

Keywords

Hawkins Inc., SEC Filing, DEF 14A, Proxy Statement, Annual Meeting, Executive Compensation, Corporate Governance, Financial Performance, Income Before Income Taxes, Shareholder Vote, Director Election, Auditor Ratification, Risk Management, Clawback Policy, Insider Trading, Equity Awards, Restricted Stock Units, CEO Pay Ratio, Deloitte & Touche, Grant Thornton, Health & Nutrition Group, Nasdaq Industrial Index

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