Increases to CEO Compensation Might Be Put On Hold For Now at GB Group plc (LON:GBG)

CEO Chris Clark has done a decent job of delivering relatively good performance at GB Group plc (LON:GBG) recently. As shareholders go into the upcoming AGM on 29 July 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.

View our latest analysis for GB Group

How Does Total Compensation For Chris Clark Compare With Other Companies In The Industry?

At the time of writing, our data shows that GB Group plc has a market capitalization of UK£1.7b, and reported total annual CEO compensation of UK£1.3m for the year to March 2021. That is, the compensation was roughly the same as last year. We think total compensation is more important but our data shows that the CEO salary is lower, at UK£504k.

For comparison, other companies in the same industry with market capitalizations ranging between UK£727m and UK£2.3b had a median total CEO compensation of UK£761k. This suggests that Chris Clark is paid more than the median for the industry. Furthermore, Chris Clark directly owns UK£2.4m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2021	2020	Proportion (2021)
Salary	UK£504k	UK£504k	38%
Other	UK£825k	UK£826k	62%
Total Compensation	UK£1.3m	UK£1.3m	100%

Talking in terms of the industry, salary represented approximately 68% of total compensation out of all the companies we analyzed, while other remuneration made up 32% of the pie. GB Group sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

GB Group plc's Growth

GB Group plc has seen its earnings per share (EPS) increase by 25% a year over the past three years. In the last year, its revenue is up 9.3%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. 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 GB Group plc Been A Good Investment?

We think that the total shareholder return of 49%, over three years, would leave most GB Group plc shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

So you may want to check if insiders are buying GB Group shares with their own money (free access).

Switching gears from GB Group, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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This article by Simply Wall St is general in nature. 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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