Black Diamond Group Limited's (TSE:BDI) CEO Will Probably Have Their Compensation Approved By Shareholders

The performance at Black Diamond Group Limited (TSE:BDI) has been quite strong recently and CEO Trevor Haynes has played a role in it. Shareholders will have this at the front of their minds in the upcoming AGM on 27 April 2021. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. Here is our take on why we think CEO compensation is not extravagant.

See our latest analysis for Black Diamond Group

How Does Total Compensation For Trevor Haynes Compare With Other Companies In The Industry?

At the time of writing, our data shows that Black Diamond Group Limited has a market capitalization of CA$232m, and reported total annual CEO compensation of CA$955k for the year to December 2020. Notably, that's a decrease of 18% over the year before. In particular, the salary of CA$550.0k, makes up a fairly large portion of the total compensation being paid to the CEO.

For comparison, other companies in the same industry with market capitalizations ranging between CA$126m and CA$503m had a median total CEO compensation of CA$1.2m. So it looks like Black Diamond Group compensates Trevor Haynes in line with the median for the industry. Furthermore, Trevor Haynes directly owns CA$15m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, around 63% of total compensation represents salary and 37% is other remuneration. Our data reveals that Black Diamond Group allocates salary more or less in line with the wider market. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Black Diamond Group Limited's Growth Numbers

Over the past three years, Black Diamond Group Limited has seen its earnings per share (EPS) grow by 106% per year. In the last year, its revenue is down 3.3%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Black Diamond Group Limited Been A Good Investment?

Boasting a total shareholder return of 57% over three years, Black Diamond Group Limited has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Seeing that company performance has been quite good recently, some shareholders may feel that CEO compensation may not be the biggest focus in the upcoming AGM. In saying that, some shareholders may feel that the more important issues to be addressed may be how the management plans to steer the company towards sustainable profitability in the future.

CEO compensation can have a massive impact on performance, but it's just one element. We've identified 2 warning signs for Black Diamond Group that investors should be aware of in a dynamic business environment.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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