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On Winn-Dixie’s High Flying CEO

When I lived in Florida, there was a saying that you could tell a lot about someone based on which supermarket they shopped in. I was pretty exclusively a Publix (PUSH) girl, though I would occasionally stray to Albertson’s. Winn-Dixie (WINN), the other big supermarket in the area — how do I say this politely? — just kind of grossed me out. There was one right across the street from my boyfriend (now husband’s) apartment complex and even if we needed something simple (and pre-packaged) like milk, I chose to drive to the Publix.

I thought about this when I was reading the preliminary proxy that Winn-Dixie filed earlier this week. Fair or not, Winn-Dixie isn’t known for catering to — pardon the retail lingo here — aspirational shoppers. Indeed, there’s actually one of those redneck jokes that says “You might be a redneck if Winn-Dixie caters your wedding”. Yet the proxy showed some very aspirational behavior. It disclosed that Chairman and CEO Peter Lynch spent $283,541 last year on his personal use of the corporate jet. That’s up from the $153,549 he spent the previous year (It’s also enough to buy more than 150,000 pounds of the $1.89 fresh ground chuck that Winn-Dixie is advertising in its home city of Jacksonville, Florida.)

What prompted that whopping 84% increase in personal jet usage? The proxy is silent on that point. But we’re pretty sure that Winn-Dixie shoppers would have something to say about it. Certainly, Winn-Dixie investors should, given how the stock has performed during roughly the same period that the proxy covers.

While we make fun of Winn-Dixie here, the fact remains: companies that enable their CEOs to act like emperors by allowing this kind of behavior tend to underperform for investors.

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