Steve Bowler became the CEO of IGas Energy plc (LON:IGAS) in 2015, 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 evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
Check out our latest analysis for IGas Energy
Comparing IGas Energy plc's CEO Compensation With the industry
According to our data, IGas Energy plc has a market capitalization of UK£16m, and paid its CEO total annual compensation worth UK£594k over the year to December 2019. We note that's an increase of 14% above last year. We note that the salary portion, which stands at UK£364.0k constitutes the majority of total compensation received by the CEO.
On comparing similar-sized companies in the industry with market capitalizations below UK£149m, we found that the median total CEO compensation was UK£284k. Hence, we can conclude that Steve Bowler is remunerated higher than the industry median.
| Component | 2019 | 2018 | Proportion (2019) |
| Salary | UK£364k | UK£357k | 61% |
| Other | UK£230k | UK£163k | 39% |
| Total Compensation | UK£594k | UK£520k | 100% |
On an industry level, around 65% of total compensation represents salary and 35% is other remuneration. IGas Energy is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
A Look at IGas Energy plc's Growth Numbers
Over the last three years, IGas Energy plc has shrunk its earnings per share by 96% per year. In the last year, its revenue is down 30%.
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. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has IGas Energy plc Been A Good Investment?
With a three year total loss of 83% for the shareholders, IGas Energy plc would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
In Summary...
As we touched on above, IGas Energy plc is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. 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.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 4 warning signs for IGas Energy that you should be aware of before investing.
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.
If you’re looking to trade IGas Energy, open an account with the lowest-cost* platform trusted by professionals, Interactive Brokers. Their clients from over 200 countries and territories trade stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted
New: Manage All Your Stock Portfolios in One Place
We've created the ultimate portfolio companion for stock investors, and it's free.
• Connect an unlimited number of Portfolios and see your total in one currency
• Be alerted to new Warning Signs or Risks via email or mobile
• Track the Fair Value of your stocks
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.
*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.
About AIM:STAR
Star Energy Group
Operates as an oil and gas exploration, development, processing, and production company in the United Kingdom.
Adequate balance sheet and fair value.
