This article will reflect on the compensation paid to Jeff Klenda who has served as CEO of Ur-Energy Inc. (TSE:URE) since 2015. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Ur-Energy.
Comparing Ur-Energy Inc.'s CEO Compensation With the industry
According to our data, Ur-Energy Inc. has a market capitalization of CA$100m, and paid its CEO total annual compensation worth US$598k over the year to December 2019. We note that's a small decrease of 6.7% on last year. We note that the salary portion, which stands at US$426.1k constitutes the majority of total compensation received by the CEO.
On comparing similar-sized companies in the industry with market capitalizations below CA$263m, we found that the median total CEO compensation was US$264k. Accordingly, our analysis reveals that Ur-Energy Inc. pays Jeff Klenda north of the industry median. Furthermore, Jeff Klenda directly owns CA$1.7m worth of shares in the company, implying that they are deeply invested in the company's success.
Talking in terms of the industry, salary represented approximately 47% of total compensation out of all the companies we analyzed, while other remuneration made up 53% of the pie. Ur-Energy pays out 71% of remuneration in the form of a salary, significantly higher than the industry average. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Ur-Energy Inc.'s Growth
Over the last three years, Ur-Energy Inc. has shrunk its earnings per share by 99% per year. Its revenue is up 48% over the last year.
Investors would be a bit wary of companies that have lower EPS But on the other hand, revenue growth is strong, suggesting a brighter future. It's hard to reach a conclusion about business performance right now. This may be one to watch. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Ur-Energy Inc. Been A Good Investment?
Given the total shareholder loss of 14% over three years, many shareholders in Ur-Energy Inc. are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
As we touched on above, Ur-Energy Inc. is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Meanwhile, the company has been unable to show any EPS growth, and shareholder returns are also in the red. On a more positive note, the company has produced a more positive revenue growth more recently. Most would consider it prudent for the company to hold off any CEO pay rise until performance improves.
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 Ur-Energy 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.
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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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