Here's Why It's Unlikely That ITV plc's (LON:ITV) CEO Will See A Pay Rise This Year

Key Insights

• ITV to hold its Annual General Meeting on 2nd of May
• Total pay for CEO Carolyn McCall includes UK£1.01m salary
• Total compensation is 41% above industry average
• ITV's EPS declined by 9.6% over the past three years while total shareholder loss over the past three years was 30%

Shareholders will probably not be too impressed with the underwhelming results at ITV plc (LON:ITV) recently. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 2nd of May. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. The data we present below explains why we think CEO compensation is not consistent with recent performance.

See our latest analysis for ITV

How Does Total Compensation For Carolyn McCall Compare With Other Companies In The Industry?

Our data indicates that ITV plc has a market capitalization of UK£2.8b, and total annual CEO compensation was reported as UK£2.9m for the year to December 2023. That's a notable decrease of 22% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at UK£1.0m.

For comparison, other companies in the British Media industry with market capitalizations ranging between UK£1.6b and UK£5.1b had a median total CEO compensation of UK£2.0m. Accordingly, our analysis reveals that ITV plc pays Carolyn McCall north of the industry median. What's more, Carolyn McCall holds UK£1.2m worth of shares in the company in their own name.

Component	2023	2022	Proportion (2023)
Salary	UK£1.0m	UK£971k	35%
Other	UK£1.9m	UK£2.7m	65%
Total Compensation	UK£2.9m	UK£3.7m	100%

On an industry level, around 55% of total compensation represents salary and 45% is other remuneration. It's interesting to note that ITV allocates a smaller portion of compensation to salary in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

ITV plc's Growth

ITV plc has reduced its earnings per share by 9.6% a year over the last three years. Its revenue is down 2.8% over the previous year.

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 ITV plc Been A Good Investment?

Few ITV plc shareholders would feel satisfied with the return of -30% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid 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, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 3 warning signs for ITV that investors should be aware of in a dynamic business environment.

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. 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.