We Take A Look At Why Urbanimmersive Inc.'s (CVE:UI) CEO Compensation Is Well Earned

We have been pretty impressed with the performance at Urbanimmersive Inc. (CVE:UI) recently and CEO Ghislain Lemire deserves a mention for their role in it. Shareholders will have this at the front of their minds in the upcoming AGM on 30 March 2021. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. Here is our take on why we think CEO compensation is not extravagant.

See our latest analysis for Urbanimmersive

How Does Total Compensation For Ghislain Lemire Compare With Other Companies In The Industry?

Our data indicates that Urbanimmersive Inc. has a market capitalization of CA$25m, and total annual CEO compensation was reported as CA$260k for the year to September 2020. That's a notable increase of 55% on last year. We note that the salary portion, which stands at CA$182.7k constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the industry with market capitalizations below CA$251m, reported a median total CEO compensation of CA$216k. So it looks like Urbanimmersive compensates Ghislain Lemire in line with the median for the industry. What's more, Ghislain Lemire holds CA$1.1m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2020	2019	Proportion (2020)
Salary	CA$183k	CA$136k	70%
Other	CA$77k	CA$32k	30%
Total Compensation	CA$260k	CA$168k	100%

Talking in terms of the industry, salary represented approximately 70% of total compensation out of all the companies we analyzed, while other remuneration made up 30% of the pie. Although there is a difference in how total compensation is set, Urbanimmersive more or less reflects the market in terms of setting the salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Urbanimmersive Inc.'s Growth Numbers

Urbanimmersive Inc.'s earnings per share (EPS) grew 67% per year over the last three years. Its revenue is up 29% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Urbanimmersive Inc. Been A Good Investment?

We think that the total shareholder return of 169%, over three years, would leave most Urbanimmersive Inc. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 5 warning signs for Urbanimmersive that investors should look into moving forward.

Important note: Urbanimmersive 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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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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