In 2015 Ian Manocha was appointed CEO of Gresham Technologies plc (LON:GHT). First, this article will compare CEO compensation with compensation at similar sized companies. Next, we’ll consider growth that the business demonstrates. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Ian Manocha’s Compensation Compare With Similar Sized Companies?
Our data indicates that Gresham Technologies plc is worth UK£73m, and total annual CEO compensation was reported as UK£349k for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at UK£260k. We took a group of companies with market capitalizations below UK£163m, and calculated the median CEO total compensation to be UK£252k.
It would therefore appear that Gresham Technologies plc pays Ian Manocha more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business. You might want to check this free visual report on analyst forecasts for future earnings.
You can see a visual representation of the CEO compensation at Gresham Technologies, below.
Is Gresham Technologies plc Growing?
Gresham Technologies plc has reduced its earnings per share by an average of 69% a year, over the last three years (measured with a line of best fit). It achieved revenue growth of 13% over the last year.
Unfortunately, earnings per share have trended lower over the last three years. There’s no doubt that the silver lining is that revenue is up. But it isn’t sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. It’s hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration.
Has Gresham Technologies plc Been A Good Investment?
Given the total loss of 6.6% over three years, many shareholders in Gresham Technologies plc are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.
We examined the amount Gresham Technologies plc pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
Neither earnings per share nor revenue have been growing sufficiently to impress us, over the last three years. Just as bad, share price gains for investors have failed to materialize, over the same period. In our opinion the CEO might be paid too generously! So you may want to check if insiders are buying Gresham Technologies shares with their own money (free access).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.