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The disappointing performance at Cooks Global Foods Limited (NZSE:CGF) will make some shareholders rather disheartened. The next AGM coming up on 28 September 2021 will be a chance for shareholders to have their concerns addressed by the board, challenge management on company strategy and vote on resolutions such as executive remuneration, which may help change the company's future prospects. From our analysis below, we think CEO compensation looks appropriate for now.
How Does Total Compensation For Graeme Jackson Compare With Other Companies In The Industry?
According to our data, Cooks Global Foods Limited has a market capitalization of NZ$27m, and paid its CEO total annual compensation worth NZ$100k over the year to March 2021. That's a notable decrease of 44% on last year. It is worth noting that the CEO compensation consists entirely of the salary, worth NZ$100k.
On comparing similar-sized companies in the industry with market capitalizations below NZ$284m, we found that the median total CEO compensation was NZ$177k. In other words, Cooks Global Foods pays its CEO lower than the industry median. What's more, Graeme Jackson holds NZ$2.5m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
On an industry level, roughly 31% of total compensation represents salary and 69% is other remuneration. At the company level, Cooks Global Foods pays Graeme Jackson solely through a salary, preferring to go down a conventional route. 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.
A Look at Cooks Global Foods Limited's Growth Numbers
Over the last three years, Cooks Global Foods Limited has shrunk its earnings per share by 3.5% per year. In the last year, its revenue is down 54%.
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. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Cooks Global Foods Limited Been A Good Investment?
With a total shareholder return of -49% over three years, Cooks Global Foods Limited shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.
Cooks Global Foods rewards its CEO solely through a salary, ignoring non-salary benefits completely. Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 4 warning signs for Cooks Global Foods (2 don't sit too well with us!) that you should be aware of before investing here.
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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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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