We Think Shareholders May Want To Consider A Review Of boohoo group plc's (LON:BOO) CEO Compensation Package

Key Insights

• boohoo group to hold its Annual General Meeting on 20th of June
• Salary of UK£676.3k is part of CEO John Lyttle's total remuneration
• The total compensation is 52% higher than the average for the industry
• boohoo group's EPS declined by 113% over the past three years while total shareholder loss over the past three years was 90%

Shareholders will probably not be too impressed with the underwhelming results at boohoo group plc (LON:BOO) recently. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 20th of June. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. From our analysis, we think CEO compensation may need a review in light of the recent performance.

See our latest analysis for boohoo group

How Does Total Compensation For John Lyttle Compare With Other Companies In The Industry?

According to our data, boohoo group plc has a market capitalization of UK£428m, and paid its CEO total annual compensation worth UK£1.7m over the year to February 2024. Notably, that's an increase of 27% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at UK£676k.

For comparison, other companies in the British Specialty Retail industry with market capitalizations ranging between UK£156m and UK£625m had a median total CEO compensation of UK£1.1m. This suggests that John Lyttle is paid more than the median for the industry. Moreover, John Lyttle also holds UK£64k worth of boohoo group stock directly under their own name.

Component	2024	2023	Proportion (2024)
Salary	UK£676k	UK£651k	39%
Other	UK£1.0m	UK£698k	61%
Total Compensation	UK£1.7m	UK£1.3m	100%

Speaking on an industry level, nearly 58% of total compensation represents salary, while the remainder of 42% is other remuneration. It's interesting to note that boohoo group 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.

A Look at boohoo group plc's Growth Numbers

Over the last three years, boohoo group plc has shrunk its earnings per share by 113% per year. It saw its revenue drop 17% over the last year.

Few shareholders would be pleased to read that EPS have declined. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 boohoo group plc Been A Good Investment?

Few boohoo group plc shareholders would feel satisfied with the return of -90% over three years. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 1 warning sign for boohoo group 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.