What Did Arbuthnot Banking Group's (LON:ARBB) CEO Take Home Last Year?

Henry Angest is the CEO of Arbuthnot Banking Group PLC (LON:ARBB), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. 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 Arbuthnot Banking Group

How Does Total Compensation For Henry Angest Compare With Other Companies In The Industry?

At the time of writing, our data shows that Arbuthnot Banking Group PLC has a market capitalization of UK£98m, and reported total annual CEO compensation of UK£1.3m for the year to December 2019. That is, the compensation was roughly the same as last year. We note that the salary portion, which stands at UK£1.20m constitutes the majority of total compensation received by the CEO.

On comparing similar-sized companies in the industry with market capitalizations below UK£150m, we found that the median total CEO compensation was UK£310k. Hence, we can conclude that Henry Angest is remunerated higher than the industry median. Moreover, Henry Angest also holds UK£48m worth of Arbuthnot Banking Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, around 40% of total compensation represents salary and 60% is other remuneration. According to our research, Arbuthnot Banking Group 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 Arbuthnot Banking Group PLC's Growth Numbers

Over the last three years, Arbuthnot Banking Group PLC has shrunk its earnings per share by 7.7% per year. In the last year, its revenue is up 5.6%.

Few shareholders would be pleased to read that EPS have declined. The fairly low revenue growth fails to impress given that the EPS is down. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 Arbuthnot Banking Group PLC Been A Good Investment?

Given the total shareholder loss of 50% over three years, many shareholders in Arbuthnot Banking Group PLC are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

As previously discussed, Henry is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. This doesn't look good against shareholder returns, which have been negative for the past three years. What's equally worrying is that the company isn't growing by our analysis. Understandably, the company's shareholders might have some questions about the CEO's remuneration, given the disappointing performance.

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 2 warning signs for Arbuthnot Banking Group 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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