12 23 2021 Moog Proxy - FY2021 - FINAL - Flipbook - Page 16
COMPENSATION DISCUSSION AND ANALYSIS
Introduction
This compensation discussion and analysis ("CD&A") provides detailed information about the compensation arrangements for
the Company’s named executive officers ("NEOs"):
•
•
•
•
•
John R. Scannell — Chief Executive Officer; Chairman of the Board; and Director
Jennifer Walter — Vice President; Chief Financial Officer
Mark J. Trabert — Vice President; President, Aircraft Controls
Maureen M. Athoe — Vice President; President, Space and Defense
Patrick J. Roche — Vice President; President, Industrial Systems *
*As announced on November 16, 2021, Mr. Roche was promoted from Vice President and President, Industrial Systems to Executive
Vice President and Chief Operating Officer, effective December 1, 2021.
This CD&A includes the Executive Compensation Committee’s compensation philosophy, the objectives of our compensation
program and a discussion of each element of compensation paid to the NEOs for our most recent fiscal year.
Executive Summary
The objective of the Company’s executive compensation program is to provide a compensation package that will attract, retain,
motivate and reward superior executives who must operate in a highly competitive and technologically challenging environment.
2021 Performance
2021 was a respectable year for the Company in the context of the macroeconomic conditions highlighted by continued impacts
of the COVID-19 pandemic. Fiscal 2020 included only 2 quarters of COVID-19 conditions whereas fiscal 2021 was a full year of
COVID-19 conditions. Sales of $2.85 billion were down 1% compared to fiscal 2020. Commercial aircraft sales decreased as
global international air travel remains muted as a result of the pandemic and Industrial Systems sales were down slightly. These
declines were partially offset by higher demand for our military aircraft programs and space and defense programs. Earnings per
share of $4.87 were up compared with last year’s $0.28 which included $1.68 per share in pandemic-related charges and $2.85
per share charge related to settlement accounting on our U.S. defined benefit pension plan. Cash flows from operating activities
in fiscal 2021 of $293 million were benefited by reduced inventories and timing of payments. Capital deployment in fiscal 2021
included payments of dividends totaling $32 million and repurchasing approximately 400,000 shares of Company stock for an
aggregate purchase price of approximately $30 million.
2021 Executive Compensation Assessment
The Executive Compensation Committee uses data provided by Korn Ferry, our compensation consultant, to establish
competitive salaries for each of the NEOs. Information regarding the compensation consultant and this analysis is provided in
greater detail throughout the CD&A.
Our total direct compensation programs consist of base salary, short-term incentive (“STI”), and long-term incentive (“LTI”), as
well as other benefits, each of which are discussed below. However, the Executive Compensation Committee also considers how
our total compensation compares with the total compensation of comparable executives in peer organizations and the broader
marketplace.
In summary, the key aspects of the Company’s compensation for the NEOs are as follows:
•
•
•
•
Base salary increases tied to market benchmarks, time in position and individual job performance;
STI, paid in cash and stock, based upon increases in earnings per share (“EPS”) and free cash flow (“FCF”) conversion;
LTI awards in the form of SARs, performance-based restricted stock units ("PSUs") and time-vested awards ("TVAs")
link NEO compensation to long-term shareholder interests; and
Benefits that include retirement and medical coverage.
Moog’s executive compensation compared to market can be summarized as:
•
•
•
13
Base salaries are between 87% and 97% of market median with an average of 91%;
Total Cash Compensation for all NEOs falls between 79% and 97% of market median with an average of 89%; and
Total Direct Compensation for all NEOs falls between 61% and 91% of market median, with an average of 80%.