We Think Bid Corporation Limited's (JSE:BID) CEO Compensation Looks Fair

Key Insights

• Bid will host its Annual General Meeting on 16th of November
• Salary of R20.6m is part of CEO Bernard Berson's total remuneration
• Total compensation is similar to the industry average
• Over the past three years, Bid's EPS grew by 68% and over the past three years, the total shareholder return was 68%

It would be hard to discount the role that CEO Bernard Berson has played in delivering the impressive results at Bid Corporation Limited (JSE:BID) recently. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 16th of November. It is likely that the focus will be on company strategy going forward as shareholders hear from the board and 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.

Check out our latest analysis for Bid

How Does Total Compensation For Bernard Berson Compare With Other Companies In The Industry?

Our data indicates that Bid Corporation Limited has a market capitalization of R142b, and total annual CEO compensation was reported as R57m for the year to June 2023. That's a notable increase of 16% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at R21m.

For comparison, other companies in the South African Consumer Retailing industry with market capitalizations ranging between R74b and R223b had a median total CEO compensation of R57m. This suggests that Bid remunerates its CEO largely in line with the industry average. What's more, Bernard Berson holds R231m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	R21m	R18m	36%
Other	R36m	R31m	64%
Total Compensation	R57m	R49m	100%

On an industry level, around 31% of total compensation represents salary and 69% is other remuneration. It's interesting to note that Bid pays out a greater portion of remuneration through salary, compared to the industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Bid Corporation Limited's Growth Numbers

Bid Corporation Limited's earnings per share (EPS) grew 68% per year over the last three years. In the last year, its revenue is up 33%.

Shareholders would be glad to know that the company has improved itself over the last few years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Bid Corporation Limited Been A Good Investment?

Most shareholders would probably be pleased with Bid Corporation Limited for providing a total return of 68% over three years. 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...

Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. 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.

Shareholders may want to check for free if Bid insiders are buying or selling shares.

Important note: Bid is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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.