What We Learned About Impellam Group's (LON:IPEL) CEO Compensation

This article will reflect on the compensation paid to Julia Robertson who has served as CEO of Impellam Group PLC (LON:IPEL) since 2013. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Impellam Group.

Check out our latest analysis for Impellam Group

Comparing Impellam Group PLC's CEO Compensation With the industry

Our data indicates that Impellam Group PLC has a market capitalization of UK£102m, and total annual CEO compensation was reported as UK£545k for the year to January 2020. That's mostly flat as compared to the prior year's compensation. We note that the salary portion, which stands at UK£477.0k constitutes the majority of total compensation received by the CEO.

On comparing similar-sized companies in the industry with market capitalizations below UK£150m, we found that the median total CEO compensation was UK£304k. Accordingly, our analysis reveals that Impellam Group PLC pays Julia Robertson north of the industry median. Moreover, Julia Robertson also holds UK£343k worth of Impellam Group stock directly under their own name.

Speaking on an industry level, nearly 75% of total compensation represents salary, while the remainder of 25% is other remuneration. According to our research, Impellam Group has allocated a higher percentage of pay to salary in comparison to the wider industry. 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.

Impellam Group PLC's Growth

Impellam Group PLC has reduced its earnings per share by 93% a year over the last three years. Its revenue is down 6.6% over the previous year.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Impellam Group PLC Been A Good Investment?

Given the total shareholder loss of 57% over three years, many shareholders in Impellam Group PLC are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

As we noted earlier, Impellam Group pays its CEO higher than the norm for similar-sized companies belonging to the same industry. Disappointingly, share price gains over the last three years have failed to materialize. Arguably worse, we've been waiting for positive EPS growth for the last three years. Overall, with such poor performance, shareholder's would probably have questions if the company decided to give the CEO a raise.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for Impellam Group that you should be aware of before investing.

Important note: Impellam Group is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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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