How Is IG Design Group's (LON:IGR) CEO Compensated?
Paul Fineman has been the CEO of IG Design Group plc (LON:IGR) since 2009, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether IG Design Group pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Check out our latest analysis for IG Design Group
How Does Total Compensation For Paul Fineman Compare With Other Companies In The Industry?
At the time of writing, our data shows that IG Design Group plc has a market capitalization of UK£426m, and reported total annual CEO compensation of UK£1.0m for the year to March 2020. Notably, that's a decrease of 50% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at UK£400k.
For comparison, other companies in the same industry with market capitalizations ranging between UK£151m and UK£605m had a median total CEO compensation of UK£801k. This suggests that IG Design Group remunerates its CEO largely in line with the industry average.
Component | 2020 | 2019 | Proportion (2020) |
Salary | UK£400k | UK£375k | 39% |
Other | UK£635k | UK£1.7m | 61% |
Total Compensation | UK£1.0m | UK£2.1m | 100% |
On an industry level, roughly 46% of total compensation represents salary and 54% is other remuneration. It's interesting to note that IG Design Group allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
IG Design Group plc's Growth
IG Design Group plc's earnings per share (EPS) grew 2.8% per year over the last three years. Its revenue is up 10% over the last year.
We would argue that the modest growth in revenue is a notable positive. And the modest growth in EPS isn't bad, either. So while performance isn't amazing, we think it really does seem quite respectable. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has IG Design Group plc Been A Good Investment?
IG Design Group plc has generated a total shareholder return of 24% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
In Summary...
As we touched on above, IG Design Group plc is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. But the company has failed to produce substantial growth in either EPS or total shareholder return. Considering the steady performance, it's tough to call out CEO compensation as too high, but shareholders might want to see more robust growth metrics before agreeing to a future raise.
CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 4 warning signs for IG Design Group that investors should think about before committing capital to this stock.
Switching gears from IG Design Group, 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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