Return on Invested Capital (“ROIC”) is defined as follows:
EBIT (Earnings before interest and taxes) less taxes and earnings from unconsolidated affiliates
(1) “Invested Capital” is defined as total assets, less cash, cash equivalents, investments in unconsolidated affiliates and non-interest bearing liabilities.
In fiscal year 2018, the Company achieved ROIC of approximately (1.0)%. For the ROIC portion of our incentive award for fiscal year 2018, our KPI levels and actual ROIC results were as follows:
FY 2018 Actual
Individual STRIVE Performance (50%) – For fiscal year 2018, the individual target performance score for each of our NEOs was 0.50.
Individual performance relates specifically to the individual annual incentive plan member and is based on an overall performance evaluation of the individual’s contributions during the fiscal year based on a determination by the individual’s immediate supervisor, or in the case of the Chief Executive Officer and the other executive officers, the Compensation Committee, compared to individualized goals set by the supervisor, or in the case of the Chief Executive Officer, the Compensation Committee. At the beginning of the fiscal year, management is required to present to the Compensation Committee specific company and individual KPIs that apply to the individual STRIVE performance portion of the FY2018 STIP. The practice of considering individual performance on a case-by-case basis permits consideration of flexible criteria, including the recognition of positive results and superior effort in the face of challenges during the fiscal year, subject to the rigor and objectivity associated with the specific company and individual KPIs established at the beginning of the fiscal year.
During fiscal year 2018, the Company employed the following priorities in furtherance of our STRIVE strategy: (1) maintaining safety as the Company’s first priority; (2) achieving cost efficiencies, including reduced corporate G&A expenses to approximately 12% of revenues, while also implementing lean processes and improving productivity; (3) utilizing portfolio and fleet optimization, combined with pursuing original equipment manufacturers (OEM) cost recoveries and capital expenditure reduction to improve liquidity and reduce debt; and (4) achieving revenue growth through contracts wins in our primary geographical hubs with a focus on delivering greater efficiencies to our core oil and gas clients. These priorities guided the establishment of the specific company and individual KPIs that were applied to the individual portion of the FY2018 STIP.
The total pool for all annual incentive plan participants as a group for the individual component of the annual incentive award is set as a multiple of the “expected” level ranging from 0 to 200% as recommended by the Chief Executive Officer and approved by the Compensation Committee. In cases of extraordinary performance, an individual may receive an amount for individual performance in excess of 200% of such participant’s targeted individual performance amount, provided that in no event may any participant’s total annual incentive award exceed 250% of such individual’s targeted total annual cash incentive award.
In recognition of the fiscal year 2018 accomplishments that are highlighted on pages 29 to 30 of this proxy statement and other performance measured against the specific company KPIs that were established at the beginning of the fiscal year, the Compensation Committee approved a total pool for all annual incentive plan participants as a group equal to 141% of the “expected” level for the individual STRIVE performance portion of the fiscal year 2018 annual incentive compensation plan.
BRISTOW GROUP INC. – 2018 Proxy Statement – 36