Key Insights
- Cineplex will host its Annual General Meeting on 21st of May
- CEO Ellis Jacob's total compensation includes salary of CA$1.00m
- Total compensation is 43% below industry average
- Cineplex's EPS grew by 7.7% over the past three years while total shareholder loss over the past three years was 19%
Shareholders may be wondering what CEO Ellis Jacob plans to do to improve the less than great performance at Cineplex Inc. (TSE:CGX) recently. At the next AGM coming up on 21st of May, they can influence managerial decision making through voting on resolutions, including executive remuneration. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. We have prepared some analysis below to show that CEO compensation looks to be reasonable.
Check out our latest analysis for Cineplex
Comparing Cineplex Inc.'s CEO Compensation With The Industry
Our data indicates that Cineplex Inc. has a market capitalization of CA$642m, and total annual CEO compensation was reported as CA$3.5m for the year to December 2024. This means that the compensation hasn't changed much from last year. While we always look at total compensation first, our analysis shows that the salary component is less, at CA$1.0m.
On examining similar-sized companies in the Canada Entertainment industry with market capitalizations between CA$280m and CA$1.1b, we discovered that the median CEO total compensation of that group was CA$6.1m. This suggests that Ellis Jacob is paid below the industry median. Furthermore, Ellis Jacob directly owns CA$1.1m worth of shares in the company.
| Component | 2024 | 2023 | Proportion (2024) |
| Salary | CA$1.0m | CA$1.0m | 29% |
| Other | CA$2.5m | CA$2.6m | 71% |
| Total Compensation | CA$3.5m | CA$3.6m | 100% |
Speaking on an industry level, nearly 66% of total compensation represents salary, while the remainder of 34% is other remuneration. In Cineplex's case, non-salary compensation represents a greater slice of total remuneration, in comparison 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.
A Look at Cineplex Inc.'s Growth Numbers
Cineplex Inc.'s earnings per share (EPS) grew 7.7% per year over the last three years. It saw its revenue drop 6.6% over the last year.
We would prefer it if there was revenue growth, but the modest improvement in EPS is good. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. 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 Cineplex Inc. Been A Good Investment?
Given the total shareholder loss of 19% over three years, many shareholders in Cineplex Inc. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
The fact that shareholders are sitting on a loss is certainly disheartening. The disappointing performance may have something to do with the flat earnings growth. In the upcoming AGM, shareholders will get the opportunity to discuss these concerns with the board and assess if the board's plan is likely to improve company performance.
While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Cineplex that you should be aware of before investing.
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.
Valuation is complex, but we're here to simplify it.
Discover if Cineplex might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.
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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.