What We Learned About Intermediate Capital Group's (LON:ICP) CEO Compensation
Benoît Laurent Durteste has been the CEO of Intermediate Capital Group plc (LON:ICP) since 2017, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Intermediate Capital Group pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Check out our latest analysis for Intermediate Capital Group
How Does Total Compensation For Benoît Laurent Durteste Compare With Other Companies In The Industry?
At the time of writing, our data shows that Intermediate Capital Group plc has a market capitalization of UK£3.8b, and reported total annual CEO compensation of UK£5.9m for the year to March 2020. Notably, that's a decrease of 38% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at UK£394k.
In comparison with other companies in the industry with market capitalizations ranging from UK£3.0b to UK£8.9b, the reported median CEO total compensation was UK£2.7m. This suggests that Benoît Laurent Durteste is paid more than the median for the industry. Furthermore, Benoît Laurent Durteste directly owns UK£15m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2020 | 2019 | Proportion (2020) |
Salary | UK£394k | UK£394k | 7% |
Other | UK£5.5m | UK£9.1m | 93% |
Total Compensation | UK£5.9m | UK£9.5m | 100% |
Speaking on an industry level, nearly 49% of total compensation represents salary, while the remainder of 51% is other remuneration. In Intermediate Capital Group's case, non-salary compensation represents a greater slice of total remuneration, 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.
A Look at Intermediate Capital Group plc's Growth Numbers
Over the last three years, Intermediate Capital Group plc has shrunk its earnings per share by 20% per year. It saw its revenue drop 13% over the last year.
The decline in EPS is a bit concerning. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Intermediate Capital Group plc Been A Good Investment?
Boasting a total shareholder return of 71% over three years, Intermediate Capital Group plc has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
To Conclude...
As we touched on above, Intermediate Capital Group plc is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. The company isn't growing EPS, but shareholder returns have been impressive over the last three years. Considering positive investor returns, it would be bold of us to criticize CEO compensation, but shareholders might want to see healthier EPS growth before a raise is given out.
CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 3 warning signs for Intermediate Capital Group you should be aware of, and 1 of them can't be ignored.
Switching gears from Intermediate Capital 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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