Simon Gill became the CEO of Highcroft Investments Plc (LON:HCFT) in 2013, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Highcroft Investments pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Note: The company does not report funds from operations, and as a result, we have used earnings per share in our analysis.
How Does Total Compensation For Simon Gill Compare With Other Companies In The Industry?
According to our data, Highcroft Investments Plc has a market capitalization of UK£34m, and paid its CEO total annual compensation worth UK£217k over the year to December 2019. That's just a smallish increase of 3.9% on last year. Notably, the salary which is UK£113.5k, represents most of the total compensation being paid.
On comparing similar-sized companies in the industry with market capitalizations below UK£154m, we found that the median total CEO compensation was UK£262k. This suggests that Highcroft Investments remunerates its CEO largely in line with the industry average.
Talking in terms of the industry, salary represented approximately 38% of total compensation out of all the companies we analyzed, while other remuneration made up 62% of the pie. It's interesting to note that Highcroft Investments pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
Highcroft Investments Plc's Growth
Highcroft Investments Plc has reduced its earnings per share by 63% a year over the last three years. Its revenue is up 16% over the last year.
The decrease in EPS could be a concern for some investors. But in contrast the revenue growth is strong, suggesting future potential for EPS growth. It's hard to reach a conclusion about business performance right now. This may be one to watch. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Highcroft Investments Plc Been A Good Investment?
Given the total shareholder loss of 11% over three years, many shareholders in Highcroft Investments Plc are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
As we noted earlier, Highcroft Investments pays its CEO in line with similar-sized companies belonging to the same industry. However, revenues have increased over the past year, a positive sign for the company. In contrast, over the same time span, shareholder returns are negative. EPS is also not growing, undoubtedly leading to further headaches. Overall, we wouldn't say CEO is highly paid, but shareholders might not go for a raise before business metrics start to improve precipitously.
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. We identified 3 warning signs for Highcroft Investments (2 make us uncomfortable!) that you should be aware of before investing here.
Switching gears from Highcroft Investments, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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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