We Think Some Shareholders May Hesitate To Increase Gibson Energy Inc.'s (TSE:GEI) CEO Compensation

CEO Steve Spaulding has done a decent job of delivering relatively good performance at Gibson Energy Inc. (TSE:GEI) recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 04 May 2021. However, some shareholders will still be cautious of paying the CEO excessively.

See our latest analysis for Gibson Energy

Comparing Gibson Energy Inc.'s CEO Compensation With the industry

At the time of writing, our data shows that Gibson Energy Inc. has a market capitalization of CA$3.1b, and reported total annual CEO compensation of CA$5.6m for the year to December 2020. That's just a smallish increase of 3.7% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at CA$828k.

In comparison with other companies in the industry with market capitalizations ranging from CA$2.5b to CA$7.9b, the reported median CEO total compensation was CA$3.6m. Accordingly, our analysis reveals that Gibson Energy Inc. pays Steve Spaulding north of the industry median. Moreover, Steve Spaulding also holds CA$5.3m worth of Gibson Energy 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 53% of total compensation out of all the companies we analyzed, while other remuneration made up 47% of the pie. Gibson Energy pays a modest slice of remuneration through salary, as compared to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Gibson Energy Inc.'s Growth

Gibson Energy Inc. has seen its earnings per share (EPS) increase by 71% a year over the past three years. In the last year, its revenue is down 33%.

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. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Gibson Energy Inc. Been A Good Investment?

Most shareholders would probably be pleased with Gibson Energy Inc. for providing a total return of 57% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 2 warning signs for Gibson Energy (1 is potentially serious!) that you should be aware of before investing here.

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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