It's Unlikely That The Warehouse Group Limited's (NZSE:WHS) CEO Will See A Huge Pay Rise This Year

Performance at The Warehouse Group Limited (NZSE:WHS) has been reasonably good and CEO Nick Grayston has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 24 November 2022, 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.

Our analysis indicates that WHS is potentially undervalued!

How Does Total Compensation For Nick Grayston Compare With Other Companies In The Industry?

According to our data, The Warehouse Group Limited has a market capitalization of NZ$1.1b, and paid its CEO total annual compensation worth NZ$3.6m over the year to July 2022. We note that's an increase of 50% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at NZ$1.5m.

In comparison with other companies in the industry with market capitalizations ranging from NZ$657m to NZ$2.6b, the reported median CEO total compensation was NZ$444k. Hence, we can conclude that Nick Grayston is remunerated higher than the industry median. What's more, Nick Grayston holds NZ$208k worth of shares in the company in their own name.

Component	2022	2021	Proportion (2022)
Salary	NZ$1.5m	NZ$1.5m	42%
Other	NZ$2.1m	NZ$917k	58%
Total Compensation	NZ$3.6m	NZ$2.4m	100%

Speaking on an industry level, nearly 38% of total compensation represents salary, while the remainder of 62% is other remuneration. Warehouse Group is paying a higher share of its remuneration through a salary in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

The Warehouse Group Limited's Growth

The Warehouse Group Limited has seen its earnings per share (EPS) increase by 9.9% a year over the past three years. Its revenue is down 3.5% over the previous year.

We would prefer it if there was revenue growth, but the modest EPS growth gives us some relief. It's hard to reach a conclusion about business performance right now. This may be one to watch. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has The Warehouse Group Limited Been A Good Investment?

The Warehouse Group Limited has served shareholders reasonably well, with a total return of 30% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

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 2 warning signs for Warehouse Group (1 is concerning!) that you should be aware of before investing here.

Switching gears from Warehouse 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. 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.