Most Shareholders Will Probably Find That The Compensation For CIBT Education Group Inc.'s (TSE:MBA) CEO Is Reasonable

The performance at CIBT Education Group Inc. (TSE:MBA) has been rather lacklustre of late and shareholders may be wondering what CEO Toby Chu is planning to do about this. One way they can exercise their influence on management is through voting on resolutions, such as executive remuneration at the next AGM, coming up on 10 February 2023. Voting on executive pay could be a powerful way to influence management, as studies have shown that the right compensation incentives impact company performance. We think CEO compensation looks appropriate given the data we have put together.

View our latest analysis for CIBT Education Group

Comparing CIBT Education Group Inc.'s CEO Compensation With The Industry

According to our data, CIBT Education Group Inc. has a market capitalization of CA$33m, and paid its CEO total annual compensation worth CA$336k over the year to August 2022. That's a notable decrease of 21% on last year. We note that the salary portion, which stands at CA$296.0k constitutes the majority of total compensation received by the CEO.

On comparing similar-sized companies in the Canada Consumer Services industry with market capitalizations below CA$268m, we found that the median total CEO compensation was CA$737k. This suggests that Toby Chu is paid below the industry median. Furthermore, Toby Chu directly owns CA$4.7m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2022	2021	Proportion (2022)
Salary	CA$296k	CA$264k	88%
Other	CA$40k	CA$159k	12%
Total Compensation	CA$336k	CA$423k	100%

Talking in terms of the industry, salary represented approximately 88% of total compensation out of all the companies we analyzed, while other remuneration made up 12% of the pie. Our data reveals that CIBT Education 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.

CIBT Education Group Inc.'s Growth

Over the last three years, CIBT Education Group Inc. has shrunk its earnings per share by 106% per year. It achieved revenue growth of 17% over the last year.

Investors would be a bit wary of companies that have lower EPS But in contrast the revenue growth is strong, suggesting future potential for EPS growth. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has CIBT Education Group Inc. Been A Good Investment?

With a three year total loss of 28% for the shareholders, CIBT Education Group Inc. would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

The fact that shareholders are sitting on a loss is certainly disheartening. The fact that earnings growth has gone backwards could be a factor for the downward trend in the share price. In the upcoming AGM, shareholders should take this opportunity to raise these concerns with the board and revisit their investment thesis with regards to the company.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 3 warning signs for CIBT Education Group you should be aware of, and 2 of them are significant.

Switching gears from CIBT Education Group, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.