J. Kynoch is the CEO of Imperial Metals Corporation (TSE:III), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Imperial Metals.
How Does Total Compensation For J. Kynoch Compare With Other Companies In The Industry?
Our data indicates that Imperial Metals Corporation has a market capitalization of CA$385m, and total annual CEO compensation was reported as CA$361k for the year to December 2019. That's a slight decrease of 6.0% on the prior year. We note that the salary portion, which stands at CA$301.7k constitutes the majority of total compensation received by the CEO.
On comparing similar companies from the same industry with market caps ranging from CA$131m to CA$525m, we found that the median CEO total compensation was CA$465k. From this we gather that J. Kynoch is paid around the median for CEOs in the industry. Furthermore, J. Kynoch directly owns CA$4.0m worth of shares in the company, implying that they are deeply invested in the company's success.
Speaking on an industry level, nearly 85% of total compensation represents salary, while the remainder of 15% is other remuneration. Imperial Metals is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. 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.
Imperial Metals Corporation's Growth
Over the last three years, Imperial Metals Corporation has shrunk its earnings per share by 60% per year. Its revenue is up 35% over the last year.
The reduction in EPS, over three years, is arguably concerning. On the other hand, the strong revenue growth suggests the business is growing. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Imperial Metals Corporation Been A Good Investment?
Imperial Metals Corporation has not done too badly by shareholders, with a total return of 1.3%, over three years. But they would probably prefer not to see CEO compensation far in excess of the median.
As previously discussed, J. is compensated close to the median for companies of its size, and which belong to the same industry. But revenue growth over the last year can't be ignored. Shareholder returns, in comparison, have not been as impressive during the same period. Additionally, shareholders would want to keep their eyes on EPS, since growth has been negative for the metric for the last three years. We wouldn't say compensation is inappropriate considering the stable performance, but shareholders might want to see some better numbers before warming to the idea of a bump.
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 Imperial Metals that investors should think about before committing capital to this stock.
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.
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