Stock Analysis

Norcros plc's (LON:NXR) CEO Compensation Is Looking A Bit Stretched At The Moment

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CEO Nick Kelsall has done a decent job of delivering relatively good performance at Norcros plc (LON:NXR) recently. As shareholders go into the upcoming AGM on 21 July 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders will still be cautious of paying the CEO excessively.

Check out our latest analysis for Norcros

Comparing Norcros plc's CEO Compensation With the industry

At the time of writing, our data shows that Norcros plc has a market capitalization of UK£257m, and reported total annual CEO compensation of UK£816k for the year to March 2021. That's a notable increase of 45% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at UK£358k.

In comparison with other companies in the industry with market capitalizations ranging from UK£144m to UK£577m, the reported median CEO total compensation was UK£521k. Hence, we can conclude that Nick Kelsall is remunerated higher than the industry median. Moreover, Nick Kelsall also holds UK£5.3m worth of Norcros stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component20212020Proportion (2021)
Salary UK£358k UK£377k 44%
Other UK£457k UK£185k 56%
Total CompensationUK£816k UK£562k100%

Speaking on an industry level, nearly 82% of total compensation represents salary, while the remainder of 18% is other remuneration. It's interesting to note that Norcros 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.

LSE:NXR CEO Compensation July 15th 2021

A Look at Norcros plc's Growth Numbers

Over the past three years, Norcros plc has seen its earnings per share (EPS) grow by 8.6% per year. Its revenue is down 5.2% over the previous year.

We would prefer it if there was revenue growth, but it is good to see a modest EPS growth at least. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Norcros plc Been A Good Investment?

We think that the total shareholder return of 60%, over three years, would leave most Norcros plc shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

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. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 1 warning sign for Norcros that investors should be aware of in a dynamic business environment.

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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