What Does Logicom's (CSE:LOG) CEO Pay Reveal?

The CEO of Logicom Public Limited (CSE:LOG) is Varnavas Irinarchos, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

Check out our latest analysis for Logicom

Comparing Logicom Public Limited's CEO Compensation With the industry

Our data indicates that Logicom Public Limited has a market capitalization of €101m, and total annual CEO compensation was reported as €183k for the year to December 2019. That's a fairly small increase of 3.8% over the previous year. We note that the salary portion, which stands at €151.2k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under €164m, the reported median total CEO compensation was €62k. Hence, we can conclude that Varnavas Irinarchos is remunerated higher than the industry median.

On an industry level, around 81% of total compensation represents salary and 19% is other remuneration. Although there is a difference in how total compensation is set, Logicom 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 Logicom Public Limited's Growth Numbers

Logicom Public Limited's earnings per share (EPS) grew 58% per year over the last three years. In the last year, its revenue is down 3.3%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's always a tough situation when revenues are not growing, but ultimately profits are more important. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Logicom Public Limited Been A Good Investment?

Boasting a total shareholder return of 33% over three years, Logicom Public Limited has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

As we noted earlier, Logicom pays its CEO higher than the norm for similar-sized companies belonging to the same industry. But EPS growth and shareholder returns have been top-notch for the past three years. So, in acknowledgment of the overall excellent performance, we believe CEO compensation is appropriate. And given most shareholders are probably very happy with recent returns, they might even think that Varnavas deserves a raise!

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 2 warning signs for Logicom that investors should look into moving forward.

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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