Is Craneware plc (LON:CRW) Overpaying Its CEO?

In 1999 Keith Neilson was appointed CEO of Craneware plc (LON:CRW). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Craneware

How Does Keith Neilson’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Craneware plc has a market cap of UK£709m, and is paying total annual CEO compensation of US$878k. (This is based on the year to June 2018). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$420k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$400m to US$1.6b. The median total CEO compensation was US$1.1m.

So Keith Neilson receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see a visual representation of the CEO compensation at Craneware, below.

AIM:CRW CEO Compensation, March 4th 2019
AIM:CRW CEO Compensation, March 4th 2019

Is Craneware plc Growing?

Over the last three years Craneware plc has grown its earnings per share (EPS) by an average of 18% per year (using a line of best fit). In the last year, its revenue is up 16%.

This demonstrates that the company has been improving recently. A good result. It’s also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. You might want to check this free visual report on analyst forecasts for future earnings.

Has Craneware plc Been A Good Investment?

I think that the total shareholder return of 269%, over three years, would leave most Craneware plc shareholders smiling. This strong performance might mean some shareholders don’t mind if the CEO were to be paid more than is normal for a company of its size.

In Summary…

Keith Neilson is paid around what is normal the leaders of comparable size companies.

The company is growing earnings per share and total shareholder returns have been pleasing. Although the pay is a normal amount, some shareholders probably consider it fair or modest, given the good performance of the stock. So you may want to check if insiders are buying Craneware shares with their own money (free access).

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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.