Most Shareholders Will Probably Find That The CEO Compensation For Microbix Biosystems Inc. (TSE:MBX) Is Reasonable

CEO Cameron Groome has done a decent job of delivering relatively good performance at Microbix Biosystems Inc. (TSE:MBX) recently. As shareholders go into the upcoming AGM on 30 March 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. Based on our analysis of the data below, we think CEO compensation seems reasonable for now.

Check out our latest analysis for Microbix Biosystems

Comparing Microbix Biosystems Inc.'s CEO Compensation With the industry

At the time of writing, our data shows that Microbix Biosystems Inc. has a market capitalization of CA$62m, and reported total annual CEO compensation of CA$363k for the year to September 2020. Notably, that's an increase of 16% over the year before. We note that the salary portion, which stands at CA$304.5k constitutes the majority of total compensation received by the CEO.

On comparing similar-sized companies in the industry with market capitalizations below CA$251m, we found that the median total CEO compensation was CA$290k. So it looks like Microbix Biosystems compensates Cameron Groome in line with the median for the industry. Moreover, Cameron Groome also holds CA$776k worth of Microbix Biosystems stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2020	2019	Proportion (2020)
Salary	CA$305k	CA$281k	84%
Other	CA$59k	CA$32k	16%
Total Compensation	CA$363k	CA$313k	100%

On an industry level, around 68% of total compensation represents salary and 32% is other remuneration. It's interesting to note that Microbix Biosystems pays out a greater portion of remuneration through salary, compared to the industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Microbix Biosystems Inc.'s Growth

Microbix Biosystems Inc.'s earnings per share (EPS) grew 1.1% per year over the last three years. In the last year, its revenue is down 10%.

We generally like to see a little revenue growth, but the modest EPS growth gives us some relief. It's hard to reach a conclusion about business performance right now. This may be one to watch. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Microbix Biosystems Inc. Been A Good Investment?

Most shareholders would probably be pleased with Microbix Biosystems Inc. for providing a total return of 86% over three years. 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.

In Summary...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. Despite the pleasing results, we still think that any proposed increases to CEO compensation will be examined based on a case by case basis and linked to performance outcomes.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 3 warning signs for Microbix Biosystems (of which 1 is a bit concerning!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from Microbix Biosystems, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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