Our View On Black Diamond Group's (TSE:BDI) CEO Pay

Trevor Haynes has been the CEO of Black Diamond Group Limited (TSE:BDI) since 2009, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

See our latest analysis for Black Diamond Group

Comparing Black Diamond Group Limited's CEO Compensation With the industry

According to our data, Black Diamond Group Limited has a market capitalization of CA$101m, and paid its CEO total annual compensation worth CA$1.2m over the year to December 2019. Notably, that's an increase of 8.2% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at CA$578k.

In comparison with other companies in the industry with market capitalizations under CA$260m, the reported median total CEO compensation was CA$284k. Accordingly, our analysis reveals that Black Diamond Group Limited pays Trevor Haynes north of the industry median. Moreover, Trevor Haynes also holds CA$5.0m worth of Black Diamond Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Talking in terms of the industry, salary represented approximately 61% of total compensation out of all the companies we analyzed, while other remuneration made up 39% of the pie. It's interesting to note that Black Diamond Group allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Black Diamond Group Limited's Growth Numbers

Black Diamond Group Limited's earnings per share (EPS) grew 92% per year over the last three years. It saw its revenue drop 7.2% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Black Diamond Group Limited Been A Good Investment?

Given the total shareholder loss of 21% over three years, many shareholders in Black Diamond Group Limited are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

As we touched on above, Black Diamond Group Limited is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. However, the EPS growth is certainly impressive, but we cannot say the same about the uninspiring shareholder returns (over the last three years). Considering overall performance, we can't say Trevor is underpaid, in fact compensation is definitely on the higher side.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 2 warning signs for Black Diamond Group that investors should look into moving forward.

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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