Shareholders May Not Be So Generous With Saturn Oil & Gas Inc.'s (TSE:SOIL) CEO Compensation And Here's Why

Key Insights

• Saturn Oil & Gas will host its Annual General Meeting on 28th of May
• Total pay for CEO John Jeffrey includes CA$619.0k salary
• Total compensation is 118% above industry average
• Over the past three years, Saturn Oil & Gas' EPS grew by 76% and over the past three years, the total loss to shareholders 27%

The underwhelming share price performance of Saturn Oil & Gas Inc. (TSE:SOIL) in the past three years would have disappointed many shareholders. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 28th of May. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

Check out our latest analysis for Saturn Oil & Gas

How Does Total Compensation For John Jeffrey Compare With Other Companies In The Industry?

According to our data, Saturn Oil & Gas Inc. has a market capitalization of CA$415m, and paid its CEO total annual compensation worth CA$3.7m over the year to December 2023. Notably, that's an increase of 22% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at CA$619k.

For comparison, other companies in the Canadian Oil and Gas industry with market capitalizations ranging between CA$273m and CA$1.1b had a median total CEO compensation of CA$1.7m. This suggests that John Jeffrey is paid more than the median for the industry. What's more, John Jeffrey holds CA$1.6m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	CA$619k	CA$423k	17%
Other	CA$3.1m	CA$2.6m	83%
Total Compensation	CA$3.7m	CA$3.0m	100%

On an industry level, roughly 38% of total compensation represents salary and 62% is other remuneration. In Saturn Oil & Gas' case, non-salary compensation represents a greater slice of total remuneration, in comparison 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.

A Look at Saturn Oil & Gas Inc.'s Growth Numbers

Saturn Oil & Gas Inc. has seen its earnings per share (EPS) increase by 76% a year over the past three years. Its revenue is up 32% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Saturn Oil & Gas Inc. Been A Good Investment?

With a three year total loss of 27% for the shareholders, Saturn Oil & Gas Inc. would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Shareholders have not seen their shares grow in value, rather they have seen their shares decline. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

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. In our study, we found 4 warning signs for Saturn Oil & Gas you should be aware of, and 1 of them doesn't sit too well with us.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.