Shareholders Would Not Be Objecting To Arch Resources, Inc.'s (NYSE:ARCH) CEO Compensation And Here's Why

Key Insights

• Arch Resources will host its Annual General Meeting on 7th of May
• Salary of US$1.00m is part of CEO Paul Lang's total remuneration
• Total compensation is similar to the industry average
• Arch Resources' EPS grew by 43% over the past three years while total shareholder return over the past three years was 320%

We have been pretty impressed with the performance at Arch Resources, Inc. (NYSE:ARCH) recently and CEO Paul Lang deserves a mention for their role in it. Coming up to the next AGM on 7th of May, shareholders would be keeping this in mind. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. We think the CEO has done a pretty decent job and we discuss why the CEO compensation is appropriate.

View our latest analysis for Arch Resources

Comparing Arch Resources, Inc.'s CEO Compensation With The Industry

Our data indicates that Arch Resources, Inc. has a market capitalization of US$2.9b, and total annual CEO compensation was reported as US$6.2m for the year to December 2023. Notably, that's a decrease of 20% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.0m.

In comparison with other companies in the American Metals and Mining industry with market capitalizations ranging from US$2.0b to US$6.4b, the reported median CEO total compensation was US$6.0m. So it looks like Arch Resources compensates Paul Lang in line with the median for the industry. Moreover, Paul Lang also holds US$29m worth of Arch Resources stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	US$1.0m	US$957k	16%
Other	US$5.2m	US$6.8m	84%
Total Compensation	US$6.2m	US$7.8m	100%

On an industry level, around 27% of total compensation represents salary and 73% is other remuneration. In Arch Resources' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Arch Resources, Inc.'s Growth

Arch Resources, Inc.'s earnings per share (EPS) grew 43% per year over the last three years. Its revenue is down 21% over the previous year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Arch Resources, Inc. Been A Good Investment?

Boasting a total shareholder return of 320% over three years, Arch Resources, Inc. has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 3 warning signs for Arch Resources that investors should think about before committing capital to this stock.

Switching gears from Arch Resources, 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.