Why H C Slingsby's (LON:SLNG) CEO Pay Matters

This article will reflect on the compensation paid to Morgan Morris who has served as CEO of H C Slingsby plc (LON:SLNG) since 2018. 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 H C Slingsby

Comparing H C Slingsby plc's CEO Compensation With the industry

At the time of writing, our data shows that H C Slingsby plc has a market capitalization of UK£2.6m, and reported total annual CEO compensation of UK£108k for the year to December 2019. That's a notable increase of 49% on last year. Notably, the salary which is UK£105.0k, represents most of the total compensation being paid.

On comparing similar-sized companies in the industry with market capitalizations below UK£151m, we found that the median total CEO compensation was UK£233k. This suggests that Morgan Morris is paid below the industry median. What's more, Morgan Morris holds UK£134k worth of shares in the company in their own name.

Talking in terms of the industry, salary represented approximately 55% of total compensation out of all the companies we analyzed, while other remuneration made up 45% of the pie. H C Slingsby has gone down a largely traditional route, paying Morgan Morris a high salary, giving it preference over non-salary benefits. 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.

H C Slingsby plc's Growth

H C Slingsby plc has seen its earnings per share (EPS) increase by 98% a year over the past three years. Revenue was pretty flat on last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has H C Slingsby plc Been A Good Investment?

Most shareholders would probably be pleased with H C Slingsby plc for providing a total return of 150% over three years. 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...

Morgan receives almost all of their compensation through a salary. As we touched on above, H C Slingsby plc is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Considering robust EPS growth, we believe Morgan to be modestly paid. Plus, we can't ignore the impressive shareholder returns, and won't be surprised if some shareholders were to reward such excellent all-around performance with a raise.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 4 warning signs for H C Slingsby (of which 1 can't be ignored!) that you should know about in order to have a holistic understanding of the stock.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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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