We Think Shareholders May Want To Consider A Review Of Victrex plc's (LON:VCT) CEO Compensation Package

Shareholders will probably not be too impressed with the underwhelming results at Victrex plc (LON:VCT) recently. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 10 February 2023. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. From our analysis, we think CEO compensation may need a review in light of the recent performance.

See our latest analysis for Victrex

Comparing Victrex plc's CEO Compensation With The Industry

According to our data, Victrex plc has a market capitalization of UK£1.7b, and paid its CEO total annual compensation worth UK£1.4m over the year to September 2022. That's a slight decrease of 5.6% on the prior year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at UK£615k.

On comparing similar companies from the British Chemicals industry with market caps ranging from UK£830m to UK£2.7b, we found that the median CEO total compensation was UK£1.3m. This suggests that Victrex remunerates its CEO largely in line with the industry average. What's more, Jakob Sigurdsson holds UK£601k worth of shares in the company in their own name.

Component	2022	2021	Proportion (2022)
Salary	UK£615k	UK£558k	43%
Other	UK£826k	UK£969k	57%
Total Compensation	UK£1.4m	UK£1.5m	100%

Talking in terms of the industry, salary represented approximately 55% of total compensation out of all the companies we analyzed, while other remuneration made up 45% of the pie. It's interesting to note that Victrex allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Victrex plc's Growth

Over the last three years, Victrex plc has shrunk its earnings per share by 6.5% per year. It achieved revenue growth of 11% over the last year.

Overall this is not a very positive result for shareholders. While the revenue growth is good to see, it is outweighed by the fact that EPS are down, over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Victrex plc Been A Good Investment?

Given the total shareholder loss of 8.5% over three years, many shareholders in Victrex plc are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

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, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for Victrex that you should be aware of before investing.

Switching gears from Victrex, 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.

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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.