Increases to CEO Compensation Might Be Put On Hold For Now at Babcock International Group PLC (LON:BAB)

Key Insights

• Babcock International Group will host its Annual General Meeting on 25th of September
• Total pay for CEO David Lockwood includes UK£883.0k salary
• The overall pay is 216% above the industry average
• Babcock International Group's total shareholder return over the past three years was 274% while its EPS grew by 15% over the past three years

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CEO David Lockwood has done a decent job of delivering relatively good performance at Babcock International Group PLC (LON:BAB) recently. As shareholders go into the upcoming AGM on 25th of September, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still want to keep CEO compensation within reason.

View our latest analysis for Babcock International Group

Comparing Babcock International Group PLC's CEO Compensation With The Industry

At the time of writing, our data shows that Babcock International Group PLC has a market capitalization of UK£5.9b, and reported total annual CEO compensation of UK£5.4m for the year to March 2025. Notably, that's an increase of 29% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at UK£883k.

In comparison with other companies in the British Aerospace & Defense industry with market capitalizations ranging from UK£2.9b to UK£8.8b, the reported median CEO total compensation was UK£1.7m. Accordingly, our analysis reveals that Babcock International Group PLC pays David Lockwood north of the industry median. Furthermore, David Lockwood directly owns UK£12m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2025	2024	Proportion (2025)
Salary	UK£883k	UK£816k	16%
Other	UK£4.5m	UK£3.3m	84%
Total Compensation	UK£5.4m	UK£4.2m	100%

On an industry level, around 37% of total compensation represents salary and 63% is other remuneration. It's interesting to note that Babcock International Group allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Babcock International Group PLC's Growth

Babcock International Group PLC's earnings per share (EPS) grew 15% per year over the last three years. It achieved revenue growth of 10% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Babcock International Group PLC Been A Good Investment?

Boasting a total shareholder return of 274% over three years, Babcock International Group PLC has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

Shareholders may want to check for free if Babcock International Group insiders are buying or selling shares.

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. 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.