Here's Why Some Shareholders May Not Be Too Generous With Ibstock plc's (LON:IBST) CEO Compensation This Year

Performance at Ibstock plc (LON:IBST) has not been particularly rosy recently and shareholders will likely be holding CEO Joe Hudson and the board accountable for this. The next AGM coming up on 22 April 2021 will be a chance for shareholders to have their concerns addressed by the board, challenge management on company strategy and vote on resolutions such as executive remuneration, which may help change the company's future prospects. The data we gathered below shows that CEO compensation looks acceptable for now.

See our latest analysis for Ibstock

How Does Total Compensation For Joe Hudson Compare With Other Companies In The Industry?

According to our data, Ibstock plc has a market capitalization of UK£941m, and paid its CEO total annual compensation worth UK£540k over the year to December 2020. That's a notable decrease of 27% on last year. In particular, the salary of UK£432.1k, makes up a huge portion of the total compensation being paid to the CEO.

On examining similar-sized companies in the industry with market capitalizations between UK£725m and UK£2.3b, we discovered that the median CEO total compensation of that group was UK£1.2m. Accordingly, Ibstock pays its CEO under the industry median.

Component	2020	2019	Proportion (2020)
Salary	UK£432k	UK£446k	80%
Other	UK£107k	UK£291k	20%
Total Compensation	UK£540k	UK£737k	100%

Talking in terms of the industry, salary represented approximately 51% of total compensation out of all the companies we analyzed, while other remuneration made up 49% of the pie. It's interesting to note that Ibstock 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.

Ibstock plc's Growth

Ibstock plc has reduced its earnings per share by 56% a year over the last three years. In the last year, its revenue is down 23%.

Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Ibstock plc Been A Good Investment?

Given the total shareholder loss of 12% over three years, many shareholders in Ibstock plc are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

Whatever your view on compensation, you might want to check if insiders are buying or selling Ibstock shares (free trial).

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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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