Here's Why Mercury NZ Limited's (NZSE:MCY) CEO Might See A Pay Rise Soon

Key Insights

• Mercury NZ will host its Annual General Meeting on 19th of September
• Total pay for CEO Vince James Hawksworth includes NZ$1.37m salary
• The total compensation is 33% less than the average for the industry
• Mercury NZ's total shareholder return over the past three years was 8.3% while its EPS grew by 26% over the past three years

The decent performance at Mercury NZ Limited (NZSE:MCY) recently will please most shareholders as they go into the AGM coming up on 19th of September. This would also be a chance for them to hear the board review the financial results, discuss future company strategy to further improve the business and vote on any resolutions such as executive remuneration. We have prepared some analysis below and we show why we think CEO compensation looks decent with even the possibility for a raise.

View our latest analysis for Mercury NZ

Comparing Mercury NZ Limited's CEO Compensation With The Industry

Our data indicates that Mercury NZ Limited has a market capitalization of NZ$8.7b, and total annual CEO compensation was reported as NZ$2.5m for the year to June 2024. We note that's a decrease of 34% compared to last year. In particular, the salary of NZ$1.37m, makes up a fairly large portion of the total compensation being paid to the CEO.

On examining similar-sized companies in the New Zealand Electric Utilities industry with market capitalizations between NZ$6.5b and NZ$20b, we discovered that the median CEO total compensation of that group was NZ$3.8m. That is to say, Vince James Hawksworth is paid under the industry median. What's more, Vince James Hawksworth holds NZ$1.6m worth of shares in the company in their own name.

Component	2024	2023	Proportion (2024)
Salary	NZ$1.4m	NZ$1.4m	54%
Other	NZ$1.2m	NZ$2.5m	46%
Total Compensation	NZ$2.5m	NZ$3.8m	100%

On an industry level, around 54% of total compensation represents salary and 46% is other remuneration. Although there is a difference in how total compensation is set, Mercury NZ more or less reflects the market in terms of setting the salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Mercury NZ Limited's Growth Numbers

Mercury NZ Limited's earnings per share (EPS) grew 26% per year over the last three years. In the last year, its revenue is up 25%.

Shareholders would be glad to know that the company has improved itself over the last few years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Mercury NZ Limited Been A Good Investment?

With a total shareholder return of 8.3% over three years, Mercury NZ Limited has done okay by shareholders, but there's always room for improvement. In light of that, investors might probably want to see an improvement on their returns before they feel generous about increasing the CEO remuneration.

To Conclude...

Overall, the company hasn't done too poorly performance-wise, but we would like to see some improvement. If it manages to keep up the current streak, CEO remuneration could well be one of shareholders' least concerns. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

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 1 warning sign for Mercury NZ that you should be aware of before investing.

Switching gears from Mercury NZ, 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.