How Does TClarke's (LON:CTO) CEO Salary Compare to Peers?

Mark Lawrence became the CEO of TClarke plc (LON:CTO) in 2010, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for TClarke.

View our latest analysis for TClarke

How Does Total Compensation For Mark Lawrence Compare With Other Companies In The Industry?

At the time of writing, our data shows that TClarke plc has a market capitalization of UK£40m, and reported total annual CEO compensation of UK£1.1m for the year to December 2019. That's a notable increase of 8.5% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at UK£314k.

On comparing similar-sized companies in the industry with market capitalizations below UK£148m, we found that the median total CEO compensation was UK£424k. Hence, we can conclude that Mark Lawrence is remunerated higher than the industry median. What's more, Mark Lawrence holds UK£207k worth of shares in the company in their own name.

On an industry level, roughly 63% of total compensation represents salary and 37% is other remuneration. It's interesting to note that TClarke allocates a smaller portion of compensation to salary in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

TClarke plc's Growth

Over the last three years, TClarke plc has shrunk its earnings per share by 2.6% per year. It saw its revenue drop 22% over the last year.

The lack of EPS growth is certainly unimpressive. And the fact that revenue is down year on year arguably paints an ugly picture. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has TClarke plc Been A Good Investment?

TClarke plc has generated a total shareholder return of 30% 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...

As we noted earlier, TClarke pays its CEO higher than the norm for similar-sized companies belonging to the same industry. Unfortunately, EPS has not grown in three years, failing to impress us. And shareholder returns are decent but not great. So you can understand why we do not think CEO compensation is particularly modest!

CEO compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 5 warning signs for TClarke 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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