Thierry Andretta has been the CEO of Mulberry Group plc (LON:MUL) since 2015, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Mulberry Group pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
View our latest analysis for Mulberry Group
How Does Total Compensation For Thierry Andretta Compare With Other Companies In The Industry?
At the time of writing, our data shows that Mulberry Group plc has a market capitalization of UK£129m, and reported total annual CEO compensation of UK£1.1m for the year to March 2020. That's a notable increase of 9.9% on last year. In particular, the salary of UK£673.0k, makes up a huge portion of the total compensation being paid to the CEO.
In comparison with other companies in the industry with market capitalizations ranging from UK£73m to UK£292m, the reported median CEO total compensation was UK£720k. This suggests that Thierry Andretta is paid more than the median for the industry.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | UK£673k | UK£659k | 62% |
| Other | UK£407k | UK£324k | 38% |
| Total Compensation | UK£1.1m | UK£983k | 100% |
Talking in terms of the industry, salary represented approximately 54% of total compensation out of all the companies we analyzed, while other remuneration made up 46% of the pie. Mulberry Group pays out 62% of remuneration in the form of a salary, significantly higher than the industry average. 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.
A Look at Mulberry Group plc's Growth Numbers
Over the last three years, Mulberry Group plc has shrunk its earnings per share by 124% per year. In the last year, its revenue is down 22%.
The decline in EPS is a bit concerning. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Mulberry Group plc Been A Good Investment?
Given the total shareholder loss of 77% over three years, many shareholders in Mulberry Group plc are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
As previously discussed, Thierry is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Disappointingly, share price gains over the last three years have failed to materialize. What's equally worrying is that the company isn't growing by our analysis. Considering such poor performance, we think shareholders might be concerned if the CEO's compensation were to grow.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. In our study, we found 2 warning signs for Mulberry Group you should be aware of, and 1 of them makes us a bit uncomfortable.
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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About AIM:MUL
Mulberry Group
Designs and manufactures fashion accessories and clothing in the United Kingdom, Asia Pacific, and internationally.
Slight and slightly overvalued.
