We Think Shareholders May Want To Consider A Review Of Camellia Plc's (LON:CAM) CEO Compensation Package

The results at Camellia Plc (LON:CAM) have been quite disappointing recently and CEO Tom Franks bears some responsibility for this. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 03 June 2021. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. From our analysis, we think CEO compensation may need a review in light of the recent performance.

View our latest analysis for Camellia

How Does Total Compensation For Tom Franks Compare With Other Companies In The Industry?

According to our data, Camellia Plc has a market capitalization of UK£195m, and paid its CEO total annual compensation worth UK£650k over the year to December 2020. That is, the compensation was roughly the same as last year. We note that the salary portion, which stands at UK£611.8k constitutes the majority of total compensation received by the CEO.

On comparing similar companies from the same industry with market caps ranging from UK£71m to UK£282m, we found that the median CEO total compensation was UK£368k. Hence, we can conclude that Tom Franks is remunerated higher than the industry median.

Component	2020	2019	Proportion (2020)
Salary	UK£612k	UK£594k	94%
Other	UK£38k	UK£43k	6%
Total Compensation	UK£650k	UK£637k	100%

On an industry level, roughly 70% of total compensation represents salary and 30% is other remuneration. It's interesting to note that Camellia pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Camellia Plc's Growth

Over the last three years, Camellia Plc has shrunk its earnings per share by 55% per year. Revenue was pretty flat on last year.

The decline in EPS is a bit concerning. And the flat revenue hardly impresses. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Camellia Plc Been A Good Investment?

Few Camellia Plc shareholders would feel satisfied with the return of -41% over three years. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

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. We did our research and identified 2 warning signs (and 1 which is significant) in Camellia we think you should know about.

Switching gears from Camellia, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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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