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How Much Does Marshalls' (LON:MSLH) CEO Make?

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Simply Wall St
·4 min read
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Martyn Coffey became the CEO of Marshalls plc (LON:MSLH) in 2013, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

See our latest analysis for Marshalls

How Does Total Compensation For Martyn Coffey Compare With Other Companies In The Industry?

According to our data, Marshalls plc has a market capitalization of UK£1.4b, and paid its CEO total annual compensation worth UK£2.2m over the year to December 2019. That's a notable increase of 38% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at UK£460k.

In comparison with other companies in the industry with market capitalizations ranging from UK£750m to UK£2.4b, the reported median CEO total compensation was UK£1.7m. From this we gather that Martyn Coffey is paid around the median for CEOs in the industry. What's more, Martyn Coffey holds UK£2.7m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component

2019

2018

Proportion (2019)

Salary

UK£460k

UK£445k

21%

Other

UK£1.8m

UK£1.2m

79%

Total Compensation

UK£2.2m

UK£1.6m

100%

Speaking on an industry level, nearly 43% of total compensation represents salary, while the remainder of 57% is other remuneration. In Marshalls' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

ceo-compensation
ceo-compensation

A Look at Marshalls plc's Growth Numbers

Marshalls plc has reduced its earnings per share by 30% a year over the last three years. It saw its revenue drop 10% over the last year.

Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Marshalls plc Been A Good Investment?

We think that the total shareholder return of 68%, over three years, would leave most Marshalls plc shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

As we touched on above, Marshalls 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. Some investors may take issue with this, especially considering shrinking EPS for the past three years. On the other hand, shareholder returns are showing positive trends over the same time frame. We're not saying CEO compensation is too generous, but shareholders might think performance needs to be improved before paying any more.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 4 warning signs for Marshalls that investors should look into moving forward.

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.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.