How Much Is North European Oil Royalty Trust's (NYSE:NRT) CEO Getting Paid?
John Van Kirk has been the CEO of North European Oil Royalty Trust (NYSE:NRT) since 2006, and this article will examine the executive's compensation 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 North European Oil Royalty Trust.
View our latest analysis for North European Oil Royalty Trust
Comparing North European Oil Royalty Trust's CEO Compensation With the industry
At the time of writing, our data shows that North European Oil Royalty Trust has a market capitalization of US$30m, and reported total annual CEO compensation of US$135k for the year to October 2019. That's mostly flat as compared to the prior year's compensation. We note that the salary portion, which stands at US$130.7k constitutes the majority of total compensation received by the CEO.
For comparison, other companies in the industry with market capitalizations below US$200m, reported a median total CEO compensation of US$624k. In other words, North European Oil Royalty Trust pays its CEO lower than the industry median.
Component | 2019 | 2018 | Proportion (2019) |
Salary | US$131k | US$128k | 97% |
Other | US$3.9k | US$3.8k | 3% |
Total Compensation | US$135k | US$132k | 100% |
Speaking on an industry level, nearly 15% of total compensation represents salary, while the remainder of 85% is other remuneration. North European Oil Royalty Trust pays a high salary, concentrating more on this aspect of compensation in comparison to non-salary pay. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
North European Oil Royalty Trust's Growth
Over the last three years, North European Oil Royalty Trust has shrunk its earnings per share by 9.3% per year. It saw its revenue drop 34% 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. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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?
Given the total shareholder loss of 31% over three years, many shareholders in North European Oil Royalty Trust are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
John receives almost all of their compensation through a salary. As we noted earlier, North European Oil Royalty Trust pays its CEO lower than the norm for similar-sized companies belonging to the same industry. While we are quite underwhelmed with EPS growth, the shareholder returns over the past three years have also failed to impress us. It's tough to say that John is earning a very high compensation, but shareholders will likely want to see healthier investor returns before agreeing that a raise is in order.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 4 warning signs for North European Oil Royalty Trust (1 is a bit unpleasant!) that you should be aware of before investing here.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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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