In 2016, Richard Edwards was appointed CEO of Anpario plc (LON:ANP). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Richard Edwards's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Anpario plc has a market cap of UK£89m, and reported total annual CEO compensation of UK£408k for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at UK£209k. We looked at a group of companies with market capitalizations under UK£163m, and the median CEO total compensation was UK£276k.
Pay mix tells us a lot about how a company functions versus the wider industry, and it's no different in the case of Anpario. Talking in terms of the sector, salary represented approximately 66% of total compensation out of all the companies we analysed, while other remuneration made up 34% of the pie. Anpario is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation
As you can see, Richard Edwards is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Anpario plc is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business. You can see a visual representation of the CEO compensation at Anpario, below.
Is Anpario plc Growing?
On average over the last three years, Anpario plc has seen earnings per share (EPS) move in a favourable direction by 14% each year (using a line of best fit). Its revenue is up 2.7% over last year.
This demonstrates that the company has been improving recently. A good result. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Shareholders might be interested in this free visualization of analyst forecasts.
Has Anpario plc Been A Good Investment?
Anpario plc has generated a total shareholder return of 25% over three years, so most shareholders would be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
We compared total CEO remuneration at Anpario plc with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.
Importantly, though, the company has impressed with its earnings per share growth, over three years. We also note that, over the same time frame, shareholder returns haven't been bad. You might wish to research management further, but on this analysis, considering the EPS growth, we wouldn't call the CEO pay problematic. Moving away from CEO compensation for the moment, we've identified 1 warning sign for Anpario 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.
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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. Thank you for reading.