We Take A Look At Whether North European Oil Royalty Trust's (NYSE:NRT) CEO May Be Underpaid
Key Insights
North European Oil Royalty Trust's Annual General Meeting to take place on 21st of February
Total pay for CEO John Van Kirk includes US$141.1k salary
Total compensation is 68% below industry average
Over the past three years, North European Oil Royalty Trust's EPS grew by 86% and over the past three years, the total shareholder return was 118%
The solid performance at North European Oil Royalty Trust (NYSE:NRT) has been impressive and shareholders will probably be pleased to know that CEO John Van Kirk has delivered. At the upcoming AGM on 21st of February, they would be interested to hear about the company strategy going forward and get a chance to cast their votes on resolutions such as executive remuneration and other company matters. Let's take a look at why we think the CEO has done a good job and we'll present the case for a bump in pay.
See our latest analysis for North European Oil Royalty Trust
How Does Total Compensation For John Van Kirk Compare With Other Companies In The Industry?
Our data indicates that North European Oil Royalty Trust has a market capitalization of US$52m, and total annual CEO compensation was reported as US$145k for the year to October 2023. That's just a smallish increase of 3.7% on last year. We note that the salary portion, which stands at US$141.1k constitutes the majority of total compensation received by the CEO.
For comparison, other companies in the American Oil and Gas industry with market capitalizations below US$200m, reported a median total CEO compensation of US$452k. This suggests that John Van Kirk is paid below the industry median. What's more, John Van Kirk holds US$83k worth of shares in the company in their own name.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$141k | US$136k | 97% |
Other | US$4.2k | US$4.1k | 3% |
Total Compensation | US$145k | US$140k | 100% |
Speaking on an industry level, nearly 14% of total compensation represents salary, while the remainder of 86% is other remuneration. North European Oil Royalty Trust has gone down a largely traditional route, paying John Van Kirk a high salary, giving it preference over non-salary benefits. 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.
North European Oil Royalty Trust's Growth
Over the past three years, North European Oil Royalty Trust has seen its earnings per share (EPS) grow by 86% per year. It achieved revenue growth of 24% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has North European Oil Royalty Trust Been A Good Investment?
Boasting a total shareholder return of 118% over three years, North European Oil Royalty Trust has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
To Conclude...
North European Oil Royalty Trust pays its CEO a majority of compensation through a salary. Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.
While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for North European Oil Royalty Trust that you should be aware of before investing.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
