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Here's Why It's Unlikely That Ingenta plc's (LON:ING) CEO Will See A Pay Rise This Year

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  • ING.L

Ingenta plc (LON:ING) has not performed well recently and CEO Gregory Winner will probably need to up their game. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 30 June 2021. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. From our analysis, we think CEO compensation may need a review in light of the recent performance.

View our latest analysis for Ingenta

Comparing Ingenta plc's CEO Compensation With the industry

At the time of writing, our data shows that Ingenta plc has a market capitalization of UK£11m, and reported total annual CEO compensation of UK£228k for the year to December 2020. That's mostly flat as compared to the prior year's compensation. In particular, the salary of UK£200.0k, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the industry with market capitalizations below UK£143m, reported a median total CEO compensation of UK£239k. So it looks like Ingenta compensates Gregory Winner in line with the median for the industry.

Component

2020

2019

Proportion (2020)

Salary

UK£200k

UK£200k

88%

Other

UK£28k

UK£26k

12%

Total Compensation

UK£228k

UK£226k

100%

Speaking on an industry level, nearly 66% of total compensation represents salary, while the remainder of 34% is other remuneration. Ingenta pays out 88% of remuneration in the form of a salary, significantly higher than the industry average. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

ceo-compensation
ceo-compensation

A Look at Ingenta plc's Growth Numbers

Over the last three years, Ingenta plc has shrunk its earnings per share by 35% per year. Its revenue is down 6.8% over the previous year.

Few shareholders would be pleased to read that EPS have declined. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Ingenta plc Been A Good Investment?

Few Ingenta plc shareholders would feel satisfied with the return of -48% over three years. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 3 warning signs for Ingenta that investors should look into moving forward.

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.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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