Bowler Metcalf Limited's (JSE:BCF) CEO Compensation Is Looking A Bit Stretched At The Moment

Simply Wall St
November 01, 2021
Source: Shutterstock

Under the guidance of CEO Friedel Sass, Bowler Metcalf Limited (JSE:BCF) has performed reasonably well recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 08 November 2021. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for Bowler Metcalf

How Does Total Compensation For Friedel Sass Compare With Other Companies In The Industry?

Our data indicates that Bowler Metcalf Limited has a market capitalization of R725m, and total annual CEO compensation was reported as R4.8m for the year to June 2021. Notably, that's an increase of 18% over the year before. Notably, the salary which is R3.44m, represents most of the total compensation being paid.

For comparison, other companies in the industry with market capitalizations below R3.0b, reported a median total CEO compensation of R2.0m. This suggests that Friedel Sass is paid more than the median for the industry. Furthermore, Friedel Sass directly owns R193m worth of shares in the company, implying that they are deeply invested in the company's success.

Component20212020Proportion (2021)
Salary R3.4m R3.3m 72%
Other R1.3m R738k 28%
Total CompensationR4.8m R4.1m100%

Speaking on an industry level, nearly 31% of total compensation represents salary, while the remainder of 69% is other remuneration. According to our research, Bowler Metcalf has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

JSE:BCF CEO Compensation November 2nd 2021

A Look at Bowler Metcalf Limited's Growth Numbers

Over the past three years, Bowler Metcalf Limited has seen its earnings per share (EPS) grow by 10% per year. In the last year, its revenue is up 14%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Bowler Metcalf Limited Been A Good Investment?

We think that the total shareholder return of 75%, over three years, would leave most Bowler Metcalf Limited shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar 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.

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 2 warning signs for Bowler Metcalf that investors should think about before committing capital to this stock.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

Discounted cash flow calculation for every stock

Simply Wall St does a detailed discounted cash flow calculation every 6 hours for every stock on the market, so if you want to find the intrinsic value of any company just search here. It’s FREE.

Make Confident Investment Decisions

Simply Wall St's Editorial Team provides unbiased, factual reporting on global stocks using in-depth fundamental analysis.
Find out more about our editorial guidelines and team.