Hallador Energy Company's (NASDAQ:HNRG) CEO Might Not Expect Shareholders To Be So Generous This Year

The results at Hallador Energy Company (NASDAQ:HNRG) have been quite disappointing recently and CEO Brent Bilsland bears some responsibility for this. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 03 June 2021. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. From our analysis, we think CEO compensation may need a review in light of the recent performance.

See our latest analysis for Hallador Energy

How Does Total Compensation For Brent Bilsland Compare With Other Companies In The Industry?

According to our data, Hallador Energy Company has a market capitalization of US$73m, and paid its CEO total annual compensation worth US$667k over the year to December 2020. That is, the compensation was roughly the same as last year. In particular, the salary of US$500.0k, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the industry with market capitalizations below US$200m, reported a median total CEO compensation of US$341k. Hence, we can conclude that Brent Bilsland is remunerated higher than the industry median. Moreover, Brent Bilsland also holds US$3.0m worth of Hallador Energy stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2020	2019	Proportion (2020)
Salary	US$500k	US$385k	75%
Other	US$167k	US$295k	25%
Total Compensation	US$667k	US$680k	100%

On an industry level, around 20% of total compensation represents salary and 80% is other remuneration. Hallador Energy pays out 75% of remuneration in the form of a salary, significantly higher than the industry average. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Hallador Energy Company's Growth

Over the last three years, Hallador Energy Company has shrunk its earnings per share by 87% per year. It saw its revenue drop 23% over the last year.

The decline in EPS is a bit concerning. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Hallador Energy Company Been A Good Investment?

With a total shareholder return of -66% over three years, Hallador Energy Company shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 3 warning signs for Hallador Energy you should be aware of, and 1 of them doesn't sit too well with us.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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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