Should You Worry About Bonterra Energy Corp.’s (TSE:BNE) CEO Salary Level?

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George Fink has been the CEO of Bonterra Energy Corp. (TSE:BNE) since 1981. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we’ll consider growth that the business demonstrates. 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.

See our latest analysis for Bonterra Energy

How Does George Fink’s Compensation Compare With Similar Sized Companies?

According to our data, Bonterra Energy Corp. has a market capitalization of CA$171m, and pays its CEO total annual compensation worth CA$401k. (This figure is for the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at CA$280k. We looked at a group of companies with market capitalizations under CA$261m, and the median CEO total compensation was CA$120k.

As you can see, George Fink is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Bonterra Energy Corp. is paying too much. 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 Bonterra Energy, below.

TSX:BNE CEO Compensation, July 5th 2019
TSX:BNE CEO Compensation, July 5th 2019

Is Bonterra Energy Corp. Growing?

Over the last three years Bonterra Energy Corp. has grown its earnings per share (EPS) by an average of 112% per year (using a line of best fit). Revenue was pretty flat on last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s good to see a bit of revenue growth, as this suggests the business is able to grow sustainably.

Has Bonterra Energy Corp. Been A Good Investment?

With a three year total loss of 76%, Bonterra Energy Corp. would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.

In Summary…

We examined the amount Bonterra Energy Corp. pays its CEO, and compared it to the amount paid by similar sized companies. We found that it pays well over the median amount paid in the benchmark group.

However, the earnings per share growth over three years is certainly impressive. Having said that, shareholders may be disappointed with the weak returns over the last three years. While EPS is positive, we’d say shareholders would want better returns before the CEO is paid much more. Whatever your view on compensation, you might want to check if insiders are buying or selling Bonterra Energy shares (free trial).

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

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.