Does Canlan Ice Sports Corp.'s (TSE:ICE) CEO Pay Reflect Performance?

By
Simply Wall St
Published
June 15, 2020
TSX:ICE

Joey St-Aubin has been the CEO of Canlan Ice Sports Corp. (TSE:ICE) since 2009. 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.

See our latest analysis for Canlan Ice Sports

How Does Joey St-Aubin's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Canlan Ice Sports Corp. has a market cap of CA$47m, and reported total annual CEO compensation of CA$364k for the year to December 2019. That's below the compensation, last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at CA$326k. We examined a group of similar sized companies, with market capitalizations of below CA$272m. The median CEO total compensation in that group is CA$219k.

Next, let's break down remuneration compositions to understand how the industry and company compare with each other. On a sector level, around 72% of total compensation represents salary and 28% is other remuneration. Canlan Ice Sports does not set aside a larger portion of remuneration in the form of salary, maintaining the same rate as the wider market.

Thus we can conclude that Joey St-Aubin receives more in total compensation than the median of a group of companies in the same market, and of similar size to Canlan Ice Sports Corp.. However, this doesn't necessarily mean the pay is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous. You can see a visual representation of the CEO compensation at Canlan Ice Sports, below.

TSX:ICE CEO Compensation June 15th 2020
TSX:ICE CEO Compensation June 15th 2020

Is Canlan Ice Sports Corp. Growing?

Over the last three years Canlan Ice Sports Corp. has shrunk its earnings per share by an average of 5.9% per year (measured with a line of best fit). In the last year, its revenue is down 5.4%.

Sadly for shareholders, earnings per share are actually down, over three years. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 Canlan Ice Sports Corp. Been A Good Investment?

Given the total loss of 0.4% over three years, many shareholders in Canlan Ice Sports Corp. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

We examined the amount Canlan Ice Sports Corp. pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.

Neither earnings per share nor revenue have been growing sufficiently to impress us, over the last three years. Over the same period, investors would have come away with nothing in the way of share price gains. In our opinion the CEO might be paid too generously! CEO compensation is an important area to keep your eyes on, but we've also identified 3 warning signs for Canlan Ice Sports (1 is a bit concerning!) that you should be aware of before investing here.

Important note: Canlan Ice Sports 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.

Love or hate this article? Concerned about the content? Get in touch with us directly. Alternatively, email 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. 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. Thank you for reading.

Promoted
If you're looking to trade Canlan Ice Sports, open an account with the lowest-cost* platform trusted by professionals, Interactive Brokers. Their clients from over 200 countries and territories trade stocks, options, futures, forex, bonds and funds worldwide from a single integrated account.

Discounted cash flow calculation for every stock

Simply Wall St does a detailed discounted cash flow calculation every 6 hours for every stock on the market, so if you want to find the intrinsic value of any company just search here. It’s FREE.


Simply Wall St character - Warren

Simply Wall St

Simply Wall St is a financial technology startup focused on providing unbiased, high-quality research coverage on every listed company in the world. Our research team consists of equity analysts with a public, market-beating track record. Learn more about the team behind Simply Wall St.