Should You Worry About Northbridge Industrial Services plc’s (LON:NBI) CEO Pay?

The CEO of Northbridge Industrial Services plc (LON:NBI) is Eric Hook. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we’ll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for Northbridge Industrial Services

How Does Eric Hook’s Compensation Compare With Similar Sized Companies?

Our data indicates that Northbridge Industrial Services plc is worth UK£44m, and total annual CEO compensation was reported as UK£244k for the year to December 2018. Notably, the salary of UK£241k is the vast majority of the CEO compensation. We examined a group of similar sized companies, with market capitalizations of below UK£154m. The median CEO total compensation in that group is UK£252k.

So Eric Hook receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn’t particularly informative alone, it gains more meaning when considered with business performance.

You can see, below, how CEO compensation at Northbridge Industrial Services has changed over time.

AIM:NBI CEO Compensation, January 21st 2020
AIM:NBI CEO Compensation, January 21st 2020

Is Northbridge Industrial Services plc Growing?

Northbridge Industrial Services plc has increased its earnings per share (EPS) by an average of 56% a year, over the last three years (using a line of best fit). Its revenue is up 19% over last year.

This demonstrates that the company has been improving recently. A good result. It’s also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. It could be important to check this free visual depiction of what analysts expect for the future.

Has Northbridge Industrial Services plc Been A Good Investment?

Northbridge Industrial Services plc has generated a total shareholder return of 16% 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.

In Summary…

Remuneration for Eric Hook is close enough to the median pay for a CEO of a similar sized company .

Shareholder returns could be better but shareholders would be pleased with the positive EPS growth. As a result of these considerations, I would suggest the CEO pay is reasonable. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Northbridge Industrial Services.

Important note: Northbridge Industrial Services may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

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