Shareholders May Not Be So Generous With Surge Energy Inc.'s (TSE:SGY) CEO Compensation And Here's Why

Key Insights

• Surge Energy's Annual General Meeting to take place on 14th of May
• Total pay for CEO Paul Colborne includes CA$465.0k salary
• Total compensation is 85% above industry average
• Over the past three years, Surge Energy's EPS grew by 47% and over the past three years, the total shareholder return was 72%

CEO Paul Colborne has done a decent job of delivering relatively good performance at Surge Energy Inc. (TSE:SGY) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 14th of May. However, some shareholders will still be cautious of paying the CEO excessively.

See our latest analysis for Surge Energy

How Does Total Compensation For Paul Colborne Compare With Other Companies In The Industry?

Our data indicates that Surge Energy Inc. has a market capitalization of CA$729m, and total annual CEO compensation was reported as CA$3.4m for the year to December 2023. We note that's an increase of 25% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at CA$465k.

In comparison with other companies in the Canadian Oil and Gas industry with market capitalizations ranging from CA$275m to CA$1.1b, the reported median CEO total compensation was CA$1.8m. Hence, we can conclude that Paul Colborne is remunerated higher than the industry median. Moreover, Paul Colborne also holds CA$7.4m worth of Surge Energy stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	CA$465k	CA$430k	14%
Other	CA$2.9m	CA$2.3m	86%
Total Compensation	CA$3.4m	CA$2.7m	100%

Talking in terms of the industry, salary represented approximately 37% of total compensation out of all the companies we analyzed, while other remuneration made up 63% of the pie. Surge Energy pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Surge Energy Inc.'s Growth

Over the past three years, Surge Energy Inc. has seen its earnings per share (EPS) grow by 47% per year. It saw its revenue drop 8.0% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Surge Energy Inc. Been A Good Investment?

Boasting a total shareholder return of 72% over three years, Surge Energy Inc. has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We did our research and identified 6 warning signs (and 1 which is a bit concerning) in Surge Energy we think you should know about.

Switching gears from Surge Energy, 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.