Is Intercontinental Gold and Metals Ltd. (CVE:ICAU) Excessively Paying Its CEO?

Gord Glenn has been the CEO of Intercontinental Gold and Metals Ltd. (CVE:ICAU) since 2015. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.

View our latest analysis for Intercontinental Gold and Metals

How Does Gord Glenn’s Compensation Compare With Similar Sized Companies?

Our data indicates that Intercontinental Gold and Metals Ltd. is worth CA$3.5m, and total annual CEO compensation is CA$328k. (This figure is for the year to March 2018). It is worth noting that the CEO compensation consists almost entirely of the salary, worth CA$319k. We examined a group of similar sized companies, with market capitalizations of below CA$266m. The median CEO total compensation in that group is CA$145k.

Thus we can conclude that Gord Glenn receives more in total compensation than the median of a group of companies in the same market, and of similar size to Intercontinental Gold and Metals Ltd.. However, this doesn’t necessarily mean the pay 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 can see a visual representation of the CEO compensation at Intercontinental Gold and Metals, below.

TSXV:ICAU CEO Compensation, March 15th 2019
TSXV:ICAU CEO Compensation, March 15th 2019

Is Intercontinental Gold and Metals Ltd. Growing?

On average over the last three years, Intercontinental Gold and Metals Ltd. has grown earnings per share (EPS) by 19% each year (using a line of best fit). Its revenue is up 2146% over last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Although we don’t have analyst forecasts, you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Intercontinental Gold and Metals Ltd. Been A Good Investment?

Boasting a total shareholder return of 160% over three years, Intercontinental Gold and Metals Ltd. has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary…

We examined the amount Intercontinental Gold and Metals Ltd. 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.

Importantly, though, the company has impressed with its earnings per share growth, over three years. In addition, shareholders have done well over the same time period. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. So you may want to check if insiders are buying Intercontinental Gold and Metals shares with their own money (free access).

Important note: Intercontinental Gold and Metals may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

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 editorial-team@simplywallst.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.