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Is Acadian Timber Corp’s (TSE:ADN) CEO Being Overpaid?

In 2015 Mark Bishop was appointed CEO of Acadian Timber Corp (TSE:ADN). First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for Acadian Timber

How Does Mark Bishop’s Compensation Compare With Similar Sized Companies?

According to our data, Acadian Timber Corp has a market capitalization of CA$262m, and pays its CEO total annual compensation worth CA$218k. (This figure is for the year to 2017). While we always look at total compensation first, we note that the salary component is less, at CA$90k. When we examined a selection of companies with market caps ranging from CA$132m to CA$529m, we found the median CEO compensation was CA$948k.

Most shareholders would consider it a positive that Mark Bishop takes less compensation than the CEOs of most similar size companies, leaving more for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.

You can see a visual representation of the CEO compensation at Acadian Timber, below.

TSX:ADN CEO Compensation November 27th 18

Is Acadian Timber Corp Growing?

Acadian Timber Corp has increased its earnings per share (EPS) by an average of 1.1% a year, over the last three years In the last year, its revenue is down -9.0%.

I would prefer it if there was revenue growth, but it is good to see EPS growth. It’s hard to reach a conclusion about business performance right now. This may be one to watch.

Shareholders might be interested in this free visualization of analyst forecasts. .

Has Acadian Timber Corp Been A Good Investment?

Since shareholders would have lost about 9.4% over three years, some Acadian Timber Corp shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary…

It appears that Acadian Timber Corp remunerates its CEO below most similar sized companies.

It’s well worth noting that while Mark Bishop is paid less than most company leaders (at similar sized companies), performance has been somewhat uninspiring, and total returns have been lacking. I am not concerned by the CEO compensation, but it would be good to see improved performance before pay increases. So you may want to check if insiders are buying Acadian Timber shares with their own money (free access).

Or you might prefer this data-rich interactive visualization of historic revenue and earnings.

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.