Shareholders Will Probably Not Have Any Issues With SRT Marine Systems plc's (LON:SRT) CEO Compensation

SRT Marine Systems plc (LON:SRT) has exhibited strong share price growth in the past few years. However, its earnings growth has not kept up, suggesting that there may be something amiss. The upcoming AGM on 22 September 2021 may be an opportunity for shareholders to bring up any concerns they may have for the board’s attention. It would also be an opportunity for them to influence management through exercising their voting power on company resolutions, including CEO and executive remuneration, which could impact on firm performance in the future. In our analysis below, we show why shareholders may consider holding off a raise for the CEO's compensation until company performance improves.

View our latest analysis for SRT Marine Systems

How Does Total Compensation For Simon Tucker Compare With Other Companies In The Industry?

Our data indicates that SRT Marine Systems plc has a market capitalization of UK£64m, and total annual CEO compensation was reported as UK£225k for the year to March 2021. There was no change in the compensation compared to last year. It is worth noting that the CEO compensation consists entirely of the salary, worth UK£225k.

In comparison with other companies in the industry with market capitalizations under UK£144m, the reported median total CEO compensation was UK£286k. This suggests that SRT Marine Systems remunerates its CEO largely in line with the industry average. Moreover, Simon Tucker also holds UK£1.1m worth of SRT Marine Systems stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2021	2020	Proportion (2021)
Salary	UK£225k	UK£225k	100%
Other	-	-	-
Total Compensation	UK£225k	UK£225k	100%

On an industry level, around 80% of total compensation represents salary and 20% is other remuneration. Speaking on a company level, SRT Marine Systems prefers to tread along a traditional path, disbursing all compensation through a salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at SRT Marine Systems plc's Growth Numbers

Over the last three years, SRT Marine Systems plc has shrunk its earnings per share by 25% per year. It saw its revenue drop 56% over the last year.

Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has SRT Marine Systems plc Been A Good Investment?

Boasting a total shareholder return of 51% over three years, SRT Marine Systems plc has done well by shareholders. 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...

SRT Marine Systems pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. Despite the strong returns on shareholders' investments, the fact that earnings have failed to grow makes us skeptical about the stock keeping up its current momentum. Shareholders should make the most of the coming opportunity to question the board on key concerns they may have and revisit their investment thesis with regards to the company.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 2 warning signs for SRT Marine Systems (of which 1 is a bit unpleasant!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from SRT Marine Systems, 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.
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