How Does Informa's (LON:INF) CEO Pay Compare With Company Performance?

Stephen Carter became the CEO of Informa plc (LON:INF) in 2013, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Informa.

View our latest analysis for Informa

How Does Total Compensation For Stephen Carter Compare With Other Companies In The Industry?

Our data indicates that Informa plc has a market capitalization of UK£8.3b, and total annual CEO compensation was reported as UK£3.7m for the year to December 2019. That's a notable decrease of 9.7% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at UK£842k.

On comparing similar companies in the industry with market capitalizations above UK£6.1b, we found that the median total CEO compensation was UK£6.9m. This suggests that Stephen Carter is paid below the industry median. Moreover, Stephen Carter also holds UK£735k worth of Informa stock directly under their own name.

Speaking on an industry level, nearly 41% of total compensation represents salary, while the remainder of 59% is other remuneration. Informa pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Informa plc's Growth Numbers

Informa plc has reduced its earnings per share by 68% a year over the last three years. In the last year, its revenue is down 19%.

The decline in EPS is a bit concerning. And the fact that revenue is down year on year arguably paints an ugly picture. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Informa plc Been A Good Investment?

With a three year total loss of 21% for the shareholders, Informa plc would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.

In Summary...

As we noted earlier, Informa pays its CEO lower than the norm for similar-sized companies belonging to the same industry. EPS growth has failed to impress us, and the same can be said about shareholder returns. Although we wouldn’t say CEO compensation is high, it’s tough to foresee shareholders warming up to thoughts of a bump anytime soon.

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. In our study, we found 3 warning signs for Informa you should be aware of, and 1 of them is concerning.

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. 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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