OUR TOTAL HOME STRATEGY

In 2020, we unveiled our Total Home strategy to grow our market share by providing a one-stop solution for every project across the home for both do-it-yourself (“DIY”) and professional (“Pro”) customers. In fiscal 2024, we continued to execute on our Total Home strategy by remaining focused on serving the Pro customer, accelerating our online business, expanding installation services, improving localization efforts and elevating our product assortment. Through the execution of our strategy over the last four years, we have grown our Pro and online sales despite a prolonged downturn in the home improvement market.

At our Analyst and Investor Conference in December 2024, we updated our Total Home strategy, aligned with the key drivers of home improvement demand, to better position the Company to take market share when the home improvement market recovers. Our Total Home strategy is designed to help our customers solve their total home improvement needs with more value and exceptional service. Looking ahead, in addition to continuing our focus on growing Pro customer and online sales, we will focus on (i) expanding home services to create a high-value installation solution for both smaller refreshes and more complex projects, (ii) creating a robust loyalty ecosystem for both our DIY and Pro customers and (iii) increasing space productivity by optimizing assortments. We are confident that we are making the right investments in the business to grow market share, generate long-term growth and continue to create sustainable shareholder value.

OVERVIEW OF OUR EXECUTIVE COMPENSATION PROGRAM

Our Executive Compensation Program is Linked to Our Strategy

Our executive compensation program is designed to drive long-term shareholder value by aligning executive pay with our strategy and shareholder interests and attracting and retaining talented executives. We have a long-standing commitment to pay for performance and provide a significant portion of compensation opportunities through variable pay arrangements.

 

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Our executive compensation program is designed to reward executives for growth in the Company’s sales and earnings, the creation of long-term shareholder value and the effective execution of our business strategies and operating priorities. The primary objectives of our executive compensation program are to:

Key Elements of Our 2024 Executive Compensation Program

Our compensation mix is heavily performance-based with 73% of the CEO’s and 68% of the other named executive officers’ (“NEOs”) average annualized target compensation at-risk and contingent upon the achievement of performance objectives or relative and absolute share price performance. Additionally, 77% of the CEO’s and 71% of the other NEOs’ average compensation is in the form of long-term incentives.

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Compensation Best Practices

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