We Think Some Shareholders May Hesitate To Increase Checkit plc's (LON:CKT) CEO Compensation

Key Insights

• Checkit's Annual General Meeting to take place on 5th of June
• Salary of UK£328.0k is part of CEO Kit Kyte's total remuneration
• The overall pay is comparable to the industry average
• Over the past three years, Checkit's EPS grew by 44% and over the past three years, the total loss to shareholders 58%

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The underwhelming share price performance of Checkit plc (LON:CKT) in the past three years would have disappointed many shareholders. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 5th of June. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

See our latest analysis for Checkit

Comparing Checkit plc's CEO Compensation With The Industry

Our data indicates that Checkit plc has a market capitalization of UK£16m, and total annual CEO compensation was reported as UK£514k for the year to January 2025. Notably, that's an increase of 28% over the year before. Notably, the salary which is UK£328.0k, represents most of the total compensation being paid.

On comparing similar-sized companies in the British Electrical industry with market capitalizations below UK£149m, we found that the median total CEO compensation was UK£406k. So it looks like Checkit compensates Kit Kyte in line with the median for the industry. Furthermore, Kit Kyte directly owns UK£100k worth of shares in the company.

Talking in terms of the broader industry, salary and other compensation roughly make up 50% each, of the total compensation. According to our research, Checkit has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Checkit plc's Growth

Over the past three years, Checkit plc has seen its earnings per share (EPS) grow by 44% per year. In the last year, its revenue is up 18%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Checkit plc Been A Good Investment?

With a total shareholder return of -58% over three years, Checkit plc shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Shareholders have not seen their shares grow in value, rather they have seen their shares decline. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 4 warning signs for Checkit (1 is concerning!) that you should be aware of before investing here.

Switching gears from Checkit, 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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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.