Increases to CEO Compensation Might Be Put On Hold For Now at Mandalay Resources Corporation (TSE:MND)

By
Simply Wall St
Published
May 19, 2021
TSX:MND
Source: Shutterstock

Performance at Mandalay Resources Corporation (TSE:MND) has been reasonably good and CEO Dominic Duffy has done a decent job of steering the company in the right direction. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 26 May 2021. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for Mandalay Resources

How Does Total Compensation For Dominic Duffy Compare With Other Companies In The Industry?

At the time of writing, our data shows that Mandalay Resources Corporation has a market capitalization of CA$264m, and reported total annual CEO compensation of US$710k for the year to December 2020. That's mostly flat as compared to the prior year's compensation. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$325k.

In comparison with other companies in the industry with market capitalizations ranging from CA$121m to CA$484m, the reported median CEO total compensation was US$390k. Hence, we can conclude that Dominic Duffy is remunerated higher than the industry median. Moreover, Dominic Duffy also holds CA$131k worth of Mandalay Resources stock directly under their own name.

Component20202019Proportion (2020)
Salary US$325k US$319k 46%
Other US$385k US$371k 54%
Total CompensationUS$710k US$691k100%

On an industry level, around 95% of total compensation represents salary and 5% is other remuneration. Mandalay Resources sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

ceo-compensation
TSX:MND CEO Compensation May 20th 2021

A Look at Mandalay Resources Corporation's Growth Numbers

Mandalay Resources Corporation has seen its earnings per share (EPS) increase by 83% a year over the past three years. In the last year, its revenue is up 59%.

This demonstrates that the company has been improving recently and is good news for the shareholders. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. 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 Mandalay Resources Corporation Been A Good Investment?

We think that the total shareholder return of 45%, over three years, would leave most Mandalay Resources Corporation shareholders smiling. 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.

To Conclude...

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. 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.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 1 warning sign for Mandalay Resources that you should be aware of before investing.

Important note: Mandalay Resources is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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