John Deane became the CEO of Chesnara plc (LON:CSN) in 2015. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
Check out our latest analysis for Chesnara
How Does John Deane’s Compensation Compare With Similar Sized Companies?
Our data indicates that Chesnara plc is worth UK£409m, and total annual CEO compensation was reported as UK£965k for the year to December 2018. While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at UK£439k. We looked at a group of companies with market capitalizations from UK£155m to UK£622m, and the median CEO total compensation was UK£684k.
As you can see, John Deane is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Chesnara plc is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see, below, how CEO compensation at Chesnara has changed over time.
Is Chesnara plc Growing?
On average over the last three years, Chesnara plc has grown earnings per share (EPS) by 3.4% each year (using a line of best fit). Its revenue is down 26% over last year.
I would prefer it if there was revenue growth, but the improvement in EPS is good. It’s hard to reach a conclusion about business performance right now. This may be one to watch. You might want to check this free visual report on analyst forecasts for future earnings.
Has Chesnara plc Been A Good Investment?
With a total shareholder return of 5.3% over three years, Chesnara plc has done okay by shareholders. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary…
We compared the total CEO remuneration paid by Chesnara plc, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
We generally prefer to see stronger EPS growth, and we’re not particularly impressed with the total shareholder return, over the last three years. So it’s certainly hard to argue that the CEO is modestly paid, although we don’t see the remuneration as an issue. Whatever your view on compensation, you might want to check if insiders are buying or selling Chesnara shares (free trial).
Important note: Chesnara may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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