Shareholders Will Probably Hold Off On Increasing The Pebble Group plc's (LON:PEBB) CEO Compensation For The Time Being

Key Insights

• Pebble Group's Annual General Meeting to take place on 30th of April
• Total pay for CEO Chris Lee includes UK£300.0k salary
• The total compensation is 73% higher than the average for the industry
• Pebble Group's three-year loss to shareholders was 54% while its EPS grew by 13% over the past three years

The underwhelming share price performance of The Pebble Group plc (LON:PEBB) in the past three years would have disappointed many shareholders. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. These are some of the concerns that shareholders may want to bring up at the next AGM held on 30th of April. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. We discuss below why we think shareholders should be cautious of approving a raise for the CEO at the moment.

Check out our latest analysis for Pebble Group

Comparing The Pebble Group plc's CEO Compensation With The Industry

Our data indicates that The Pebble Group plc has a market capitalization of UK£104m, and total annual CEO compensation was reported as UK£407k for the year to December 2023. That's a notable decrease of 9.3% on last year. In particular, the salary of UK£300.0k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the British Media industry with market capitalizations below UK£160m, we found that the median total CEO compensation was UK£236k. This suggests that Chris Lee is paid more than the median for the industry. Furthermore, Chris Lee directly owns UK£3.8m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	UK£300k	UK£285k	74%
Other	UK£107k	UK£164k	26%
Total Compensation	UK£407k	UK£449k	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. Pebble Group pays out 74% of remuneration in the form of a salary, significantly higher than the industry average. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at The Pebble Group plc's Growth Numbers

Over the past three years, The Pebble Group plc has seen its earnings per share (EPS) grow by 13% per year. Its revenue is down 7.4% over the previous year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. 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 The Pebble Group plc Been A Good Investment?

Few The Pebble Group plc shareholders would feel satisfied with the return of -54% over three years. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

Shareholders may want to check for free if Pebble Group insiders are buying or selling shares.

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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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.