Stock Analysis

Endeavour Mining plc's (TSE:EDV) CEO Looks Like They Deserve Their Pay Packet

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It would be hard to discount the role that CEO Sebastien de Montessus has played in delivering the impressive results at Endeavour Mining plc (TSE:EDV) recently. Coming up to the next AGM on 08 September 2021, shareholders would be keeping this in mind. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.

See our latest analysis for Endeavour Mining

Comparing Endeavour Mining plc's CEO Compensation With the industry

Our data indicates that Endeavour Mining plc has a market capitalization of CA$7.7b, and total annual CEO compensation was reported as US$4.5m for the year to December 2020. That's a notable decrease of 17% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$950k.

For comparison, other companies in the same industry with market capitalizations ranging between CA$5.0b and CA$15b had a median total CEO compensation of US$4.9m. From this we gather that Sebastien de Montessus is paid around the median for CEOs in the industry. Furthermore, Sebastien de Montessus directly owns CA$28m worth of shares in the company, implying that they are deeply invested in the company's success.

Component20202019Proportion (2020)
Salary US$950k US$950k 21%
Other US$3.5m US$4.4m 79%
Total CompensationUS$4.5m US$5.4m100%

Talking in terms of the industry, salary represented approximately 86% of total compensation out of all the companies we analyzed, while other remuneration made up 14% of the pie. Endeavour Mining 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.

TSX:EDV CEO Compensation September 2nd 2021

Endeavour Mining plc's Growth

Endeavour Mining plc has seen its earnings per share (EPS) increase by 63% a year over the past three years. In the last year, its revenue is up 213%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Endeavour Mining plc Been A Good Investment?

Most shareholders would probably be pleased with Endeavour Mining plc for providing a total return of 61% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

Given the improved performance, shareholders may be more forgiving of CEO compensation in the upcoming AGM. However, despite the strong growth in earnings and share price growth, the focus for shareholders would be how the company plans to steer the company towards sustainable profitability in the near future.

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 Endeavour Mining (1 can't be ignored!) that you should be aware of before investing here.

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