Here's Why Shareholders Should Examine Symphony Environmental Technologies plc's (LON:SYM) CEO Compensation Package More Closely

Key Insights

• Symphony Environmental Technologies will host its Annual General Meeting on 28th of June
• CEO Michael Laurier's total compensation includes salary of UK£257.0k
• The total compensation is similar to the average for the industry
• Over the past three years, Symphony Environmental Technologies' EPS fell by 40% and over the past three years, the total loss to shareholders 85%

Shareholders will probably not be too impressed with the underwhelming results at Symphony Environmental Technologies plc (LON:SYM) recently. At the upcoming AGM on 28th of June, shareholders can hear from the board including their plans for turning around performance. 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. We present the case why we think CEO compensation is out of sync with company performance.

Check out our latest analysis for Symphony Environmental Technologies

How Does Total Compensation For Michael Laurier Compare With Other Companies In The Industry?

Our data indicates that Symphony Environmental Technologies plc has a market capitalization of UK£5.4m, and total annual CEO compensation was reported as UK£260k for the year to December 2023. Notably, that's an increase of 18% over the year before. In particular, the salary of UK£257.0k, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the British Chemicals industry with market capitalizations below UK£158m, reported a median total CEO compensation of UK£262k. From this we gather that Michael Laurier is paid around the median for CEOs in the industry. Furthermore, Michael Laurier directly owns UK£621k worth of shares in the company.

Speaking on an industry level, nearly 73% of total compensation represents salary, while the remainder of 27% is other remuneration. Symphony Environmental Technologies is focused on going down a more traditional approach and is paying a higher portion of compensation through salary, as compared to non-salary benefits. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Symphony Environmental Technologies plc's Growth

Symphony Environmental Technologies plc has reduced its earnings per share by 40% a year over the last three years. Its revenue is up 3.2% over the last year.

The decline in EPS is a bit concerning. And the modest revenue growth over 12 months isn't much comfort against the reduced EPS. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Symphony Environmental Technologies plc Been A Good Investment?

The return of -85% over three years would not have pleased Symphony Environmental Technologies plc shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Michael receives almost all of their compensation through a salary. 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, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

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. That's why we did our research, and identified 5 warning signs for Symphony Environmental Technologies (of which 4 are potentially serious!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from Symphony Environmental Technologies, 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com