Shareholders May Not Be So Generous With Diurnal Group plc's (LON:DNL) CEO Compensation And Here's Why

By
Simply Wall St
Published
November 12, 2021
AIM:DNL
Source: Shutterstock

CEO Martin Whitaker has done a decent job of delivering relatively good performance at Diurnal Group plc (LON:DNL) recently. As shareholders go into the upcoming AGM on 19 November 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

See our latest analysis for Diurnal Group

How Does Total Compensation For Martin Whitaker Compare With Other Companies In The Industry?

At the time of writing, our data shows that Diurnal Group plc has a market capitalization of UK£100m, and reported total annual CEO compensation of UK£487k for the year to June 2021. That's a slight decrease of 4.9% on the prior year. Notably, the salary which is UK£263.0k, represents a considerable chunk of the total compensation being paid.

For comparison, other companies in the industry with market capitalizations below UK£149m, reported a median total CEO compensation of UK£252k. Accordingly, our analysis reveals that Diurnal Group plc pays Martin Whitaker north of the industry median. Furthermore, Martin Whitaker directly owns UK£535k worth of shares in the company.

Component20212020Proportion (2021)
Salary UK£263k UK£255k 54%
Other UK£224k UK£257k 46%
Total CompensationUK£487k UK£512k100%

On an industry level, roughly 53% of total compensation represents salary and 47% is other remuneration. Our data reveals that Diurnal Group allocates salary more or less in line with the wider market. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

ceo-compensation
AIM:DNL CEO Compensation November 13th 2021

Diurnal Group plc's Growth

Over the past three years, Diurnal Group plc has seen its earnings per share (EPS) grow by 64% per year. It saw its revenue drop 31% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's always a tough situation when revenues are not growing, but ultimately profits are more important. 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 Diurnal Group plc Been A Good Investment?

We think that the total shareholder return of 113%, over three years, would leave most Diurnal Group plc shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

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 Diurnal Group that you should be aware of before investing.

Important note: Diurnal Group is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

Discounted cash flow calculation for every stock

Simply Wall St does a detailed discounted cash flow calculation every 6 hours for every stock on the market, so if you want to find the intrinsic value of any company just search here. It’s FREE.

Make Confident Investment Decisions

Simply Wall St's Editorial Team provides unbiased, factual reporting on global stocks using in-depth fundamental analysis.
Find out more about our editorial guidelines and team.