We Discuss Why Bushveld Minerals Limited's (LON:BMN) CEO Compensation May Be Closely Reviewed

Shareholders will probably not be too impressed with the underwhelming results at Bushveld Minerals Limited (LON:BMN) recently. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 05 August 2021. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. The data we present below explains why we think CEO compensation is not consistent with recent performance.

View our latest analysis for Bushveld Minerals

How Does Total Compensation For Fortune Mojapelo Compare With Other Companies In The Industry?

Our data indicates that Bushveld Minerals Limited has a market capitalization of UK£137m, and total annual CEO compensation was reported as US$604k for the year to December 2020. We note that's a decrease of 26% compared to last year. In particular, the salary of US$381.1k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar companies from the same industry with market caps ranging from UK£72m to UK£286m, we found that the median CEO total compensation was US$628k. This suggests that Bushveld Minerals remunerates its CEO largely in line with the industry average. Moreover, Fortune Mojapelo also holds UK£1.0m worth of Bushveld Minerals stock directly under their own name.

Component	2020	2019	Proportion (2020)
Salary	US$381k	US$416k	63%
Other	US$223k	US$400k	37%
Total Compensation	US$604k	US$817k	100%

On an industry level, roughly 62% of total compensation represents salary and 38% is other remuneration. Bushveld Minerals is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Bushveld Minerals Limited's Growth

Bushveld Minerals Limited has reduced its earnings per share by 5.7% a year over the last three years. Its revenue is down 23% over the previous year.

The decline in EPS is a bit concerning. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Bushveld Minerals Limited Been A Good Investment?

With a total shareholder return of -56% over three years, Bushveld Minerals Limited shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

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 3 warning signs (and 1 which can't be ignored) in Bushveld Minerals we think you should know about.

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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