It would be hard to discount the role that CEO Jim Millen has played in delivering the impressive results at Physiomics Plc (LON:PYC) recently. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 23 November 2021. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. We think the CEO has done a pretty decent job and we discuss why the CEO compensation is appropriate.
Comparing Physiomics Plc's CEO Compensation With the industry
According to our data, Physiomics Plc has a market capitalization of UK£6.9m, and paid its CEO total annual compensation worth UK£146k over the year to June 2021. That's a modest increase of 7.8% on the prior year. We note that the salary portion, which stands at UK£124.1k constitutes the majority of total compensation received by the CEO.
For comparison, other companies in the industry with market capitalizations below UK£149m, reported a median total CEO compensation of UK£173k. From this we gather that Jim Millen is paid around the median for CEOs in the industry. Furthermore, Jim Millen directly owns UK£95k worth of shares in the company.
On an industry level, around 52% of total compensation represents salary and 48% is other remuneration. Physiomics pays out 85% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
A Look at Physiomics Plc's Growth Numbers
Physiomics Plc has seen its earnings per share (EPS) increase by 16% a year over the past three years. It saw its revenue drop 13% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. 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 Physiomics Plc Been A Good Investment?
We think that the total shareholder return of 47%, over three years, would leave most Physiomics Plc shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
Seeing that company performance has been quite good recently, some shareholders may feel that CEO compensation may not be the biggest focus in the upcoming AGM. However, despite the strong growth in earnings and share price growth, the focus for shareholders would be how the company plans to steer the company towards sustainable profitability in the near future.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 3 warning signs for Physiomics you should be aware of, and 2 of them are concerning.
Important note: Physiomics 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.
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.
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