Marvin Haasen has been the CEO of Madison Pacific Properties Inc. (TSE:MPC) since 2012, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Madison Pacific Properties pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Check out our latest analysis for Madison Pacific Properties
How Does Total Compensation For Marvin Haasen Compare With Other Companies In The Industry?
Our data indicates that Madison Pacific Properties Inc. has a market capitalization of CA$219m, and total annual CEO compensation was reported as CA$392k for the year to August 2020. This means that the compensation hasn't changed much from last year. We note that the salary portion, which stands at CA$234.2k constitutes the majority of total compensation received by the CEO.
On comparing similar companies from the same industry with market caps ranging from CA$126m to CA$504m, we found that the median CEO total compensation was CA$992k. That is to say, Marvin Haasen is paid under the industry median.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | CA$234k | CA$245k | 60% |
| Other | CA$158k | CA$139k | 40% |
| Total Compensation | CA$392k | CA$384k | 100% |
On an industry level, roughly 53% of total compensation represents salary and 47% is other remuneration. According to our research, Madison Pacific Properties has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
A Look at Madison Pacific Properties Inc.'s Growth Numbers
Over the last three years, Madison Pacific Properties Inc. has shrunk its earnings per share by 21% per year. The trailing twelve months of revenue was pretty much the same as the prior period.
The decline in EPS is a bit concerning. And the flat revenue hardly impresses. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Madison Pacific Properties Inc. Been A Good Investment?
Madison Pacific Properties Inc. has generated a total shareholder return of 23% over three years, so most shareholders would be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
To Conclude...
As we noted earlier, Madison Pacific Properties pays its CEO lower than the norm for similar-sized companies belonging to the same industry. While we have not been overly impressed by shareholder returns, EPS growth has been negative over the last three years, a real headache for the company. We can't categorize CEO compensation as high, but shareholders might object to a raise at this stage, considering overall poor performance.
CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 4 warning signs for Madison Pacific Properties you should be aware of, and 2 of them are significant.
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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About TSX:MPC
Madison Pacific Properties
Invests in, develops, owns, and manages real estate properties in Canada.
Moderate risk unattractive dividend payer.
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