UK Markets closed

Is Arcontech Group plc (LON:ARC) Overpaying Its CEO?

Blake Harford

Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!

Matthew Jeffs became the CEO of Arcontech Group plc (LON:ARC) in 2013. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Arcontech Group

How Does Matthew Jeffs’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Arcontech Group plc has a market cap of UK£17m, and is paying total annual CEO compensation of UK£309k. (This number is for the twelve months until 2018). While we always look at total compensation first, we note that the salary component is less, at UK£154k. We looked at a group of companies with market capitalizations under UK£155m, and the median CEO compensation was UK£245k.

So Matthew Jeffs receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see, below, how CEO compensation at Arcontech Group has changed over time.

AIM:ARC CEO Compensation February 13th 19

Is Arcontech Group plc Growing?

Arcontech Group plc has increased its earnings per share (EPS) by an average of 22% a year, over the last three years (using a line of best fit). Its revenue is up 9.2% over last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. It’s also good to see modest revenue growth, suggesting the underlying business is healthy. You might want to check this free visual report on analyst forecasts for future earnings.

Has Arcontech Group plc Been A Good Investment?

I think that the total shareholder return of 304%, over three years, would leave most Arcontech Group plc shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary…

Matthew Jeffs is paid around the same as most CEOs of similar size companies.

The company is growing earnings per share and total shareholder returns have been pleasing. Although the pay is a normal amount, some shareholders probably consider it fair or modest, given the good performance of the stock. Shareholders may want to check for free if Arcontech Group insiders are buying or selling shares.

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

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.