Here's Why Shareholders Should Examine Marks Electrical Group PLC's (LON:MRK) CEO Compensation Package More Closely

Key Insights

• Marks Electrical Group to hold its Annual General Meeting on 7th of August
• Total pay for CEO Mark Smithson includes UK£306.0k salary
• Total compensation is similar to the industry average
• Over the past three years, Marks Electrical Group's EPS fell by 88% and over the past three years, the total loss to shareholders 11%

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Marks Electrical Group PLC (LON:MRK) has not performed well recently and CEO Mark Smithson will probably need to up their game. At the upcoming AGM on 7th of August, shareholders can hear from the board including their plans for turning around performance. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. The data we present below explains why we think CEO compensation is not consistent with recent performance.

View our latest analysis for Marks Electrical Group

Comparing Marks Electrical Group PLC's CEO Compensation With The Industry

At the time of writing, our data shows that Marks Electrical Group PLC has a market capitalization of UK£63m, and reported total annual CEO compensation of UK£317k for the year to March 2025. There was no change in the compensation compared to last year. In particular, the salary of UK£306.0k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the British Specialty Retail industry with market capitalizations below UK£151m, we found that the median total CEO compensation was UK£445k. This suggests that Marks Electrical Group remunerates its CEO largely in line with the industry average. What's more, Mark Smithson holds UK£47m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

On an industry level, around 53% of total compensation represents salary and 47% is other remuneration. Investors will find it interesting that Marks Electrical Group pays the bulk of its rewards through a traditional salary, instead of non-salary benefits. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Marks Electrical Group PLC's Growth

Over the last three years, Marks Electrical Group PLC has shrunk its earnings per share by 88% per year. In the last year, its revenue is up 2.6%.

The decline in EPS is a bit concerning. The fairly low revenue growth fails to impress given that the EPS is down. These factors suggest that the business performance wouldn't really justify a high pay packet 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 Marks Electrical Group PLC Been A Good Investment?

Since shareholders would have lost about 11% over three years, some Marks Electrical Group PLC investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Marks Electrical Group pays its CEO a majority of compensation through a salary. Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 2 warning signs for Marks Electrical Group that investors should look into moving forward.

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. 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.