Here's What We Learned About The CEO Pay At SilverBridge Holdings Limited (JSE:SVB)

This article will reflect on the compensation paid to Jaco Swanepoel who has served as CEO of SilverBridge Holdings Limited (JSE:SVB) since 2005. This analysis will also assess whether SilverBridge Holdings pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

Check out our latest analysis for SilverBridge Holdings

How Does Total Compensation For Jaco Swanepoel Compare With Other Companies In The Industry?

According to our data, SilverBridge Holdings Limited has a market capitalization of R24m, and paid its CEO total annual compensation worth R2.9m over the year to June 2020. That's just a smallish increase of 5.6% on last year. Notably, the salary which is R2.63m, 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 R3.4m. This suggests that SilverBridge Holdings remunerates its CEO largely in line with the industry average. Furthermore, Jaco Swanepoel directly owns R3.0m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, around 89% of total compensation represents salary and 11% is other remuneration. Our data reveals that SilverBridge Holdings allocates salary more or less in line with the wider market. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

SilverBridge Holdings Limited's Growth

Over the last three years, SilverBridge Holdings Limited has shrunk its earnings per share by 41% per year. It achieved revenue growth of 3.1% over the last year.

Overall this is not a very positive result for shareholders. And the modest revenue growth over 12 months isn't much comfort against the reduced EPS. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has SilverBridge Holdings Limited Been A Good Investment?

With a three year total loss of 59% for the shareholders, SilverBridge Holdings Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

As we touched on above, SilverBridge Holdings Limited is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. In the meantime, the company has reported declining EPS growth and shareholder returns over the last three years. We'd stop short of saying compensation is inappropriate, but we would understand if shareholders had questions regarding a future raise.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 3 warning signs for SilverBridge Holdings (of which 2 are a bit concerning!) that you should know about in order to have a holistic understanding of the stock.

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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