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

Key Insights

• Altitude Group will host its Annual General Meeting on 23rd of September
• CEO Nikki Stella's total compensation includes salary of UK£281.0k
• The total compensation is 78% higher than the average for the industry
• Altitude Group's EPS grew by 113% over the past three years while total shareholder loss over the past three years was 9.7%

In the past three years, shareholders of Altitude Group plc (LON:ALT) have seen a loss on their investment. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 23rd of September. They could also influence management through voting on resolutions such as executive remuneration. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

Check out our latest analysis for Altitude Group

Comparing Altitude Group plc's CEO Compensation With The Industry

At the time of writing, our data shows that Altitude Group plc has a market capitalization of UK£24m, and reported total annual CEO compensation of UK£505k for the year to March 2024. We note that's an increase of 22% above last year. In particular, the salary of UK£281.0k, makes up a fairly large portion of the total compensation being paid to the CEO.

In comparison with other companies in the British Software industry with market capitalizations under UK£152m, the reported median total CEO compensation was UK£284k. This suggests that Nikki Stella is paid more than the median for the industry. Furthermore, Nikki Stella directly owns UK£528k worth of shares in the company.

Component	2024	2023	Proportion (2024)
Salary	UK£281k	UK£263k	56%
Other	UK£224k	UK£151k	44%
Total Compensation	UK£505k	UK£414k	100%

On an industry level, roughly 64% of total compensation represents salary and 36% is other remuneration. Altitude Group sets aside a smaller share of compensation for salary, in comparison to the overall industry. 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.

A Look at Altitude Group plc's Growth Numbers

Over the past three years, Altitude Group plc has seen its earnings per share (EPS) grow by 113% per year. Its revenue is up 28% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Altitude Group plc Been A Good Investment?

With a three year total loss of 9.7% for the shareholders, Altitude Group plc would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Shareholders have not seen their shares grow in value, rather they have seen their shares decline. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

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 3 warning signs for Altitude Group that you should be aware of before investing.

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.