This Is Why t42 IoT Tracking Solutions PLC's (LON:TRAC) CEO Compensation Looks Appropriate

Key Insights

• t42 IoT Tracking Solutions' Annual General Meeting to take place on 16th of December
• Salary of US$165.0k is part of CEO Avi Hartmann's total remuneration
• The total compensation is 50% less than the average for the industry
• Over the past three years, t42 IoT Tracking Solutions' EPS grew by 49% and over the past three years, the total loss to shareholders 67%

Shareholders may be wondering what CEO Avi Hartmann plans to do to improve the less than great performance at t42 IoT Tracking Solutions PLC (LON:TRAC) recently. One way they can exercise their influence on management is through voting on resolutions, such as executive remuneration at the next AGM, coming up on 16th of December. Voting on executive pay could be a powerful way to influence management, as studies have shown that the right compensation incentives impact company performance. In our opinion, CEO compensation does not look excessive and we discuss why.

See our latest analysis for t42 IoT Tracking Solutions

Comparing t42 IoT Tracking Solutions PLC's CEO Compensation With The Industry

Our data indicates that t42 IoT Tracking Solutions PLC has a market capitalization of UK£1.9m, and total annual CEO compensation was reported as US$178k for the year to December 2023. We note that's a decrease of 11% compared to last year. Notably, the salary which is US$165.0k, represents most of the total compensation being paid.

For comparison, other companies in the British Software industry with market capitalizations below UK£157m, reported a median total CEO compensation of US$357k. In other words, t42 IoT Tracking Solutions pays its CEO lower than the industry median. Moreover, Avi Hartmann also holds UK£199k worth of t42 IoT Tracking Solutions stock directly under their own name.

Component	2023	2022	Proportion (2023)
Salary	US$165k	US$186k	93%
Other	US$13k	US$14k	7%
Total Compensation	US$178k	US$200k	100%

On an industry level, around 65% of total compensation represents salary and 35% is other remuneration. It's interesting to note that t42 IoT Tracking Solutions pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

t42 IoT Tracking Solutions PLC's Growth

t42 IoT Tracking Solutions PLC has seen its earnings per share (EPS) increase by 49% a year over the past three years. Its revenue is up 21% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has t42 IoT Tracking Solutions PLC Been A Good Investment?

Few t42 IoT Tracking Solutions PLC shareholders would feel satisfied with the return of -67% over three years. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

The fact that shareholders have earned a negative share price return is certainly disconcerting. This diverges with the robust growth in EPS, suggesting that there is a large discrepancy between share price and fundamentals. A key question may be why the fundamentals have not yet been reflected into the share price. The upcoming AGM will provide shareholders the opportunity to raise their concerns and evaluate if the board’s judgement and decision-making is aligned with their expectations.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 5 warning signs for t42 IoT Tracking Solutions (3 make us uncomfortable!) that you should be aware of before investing here.

Switching gears from t42 IoT Tracking Solutions, 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. 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.