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Is Oxford Metrics Plc's (LON:OMG) CEO Paid Enough Relative To Peers?

Simply Wall St

Nick Bolton has been the CEO of Oxford Metrics Plc (LON:OMG) since 2005. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.

See our latest analysis for Oxford Metrics

How Does Nick Bolton's Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Oxford Metrics Plc has a market cap of UK£104m, and is paying total annual CEO compensation of UK£1.1m. (This number is for the twelve months until September 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at UK£261k. We took a group of companies with market capitalizations below UK£163m, and calculated the median CEO total compensation to be UK£251k.

As you can see, Nick Bolton is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Oxford Metrics Plc is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.

You can see a visual representation of the CEO compensation at Oxford Metrics, below.

AIM:OMG CEO Compensation, August 28th 2019

Is Oxford Metrics Plc Growing?

On average over the last three years, Oxford Metrics Plc has shrunk earnings per share by 19% each year (measured with a line of best fit). In the last year, its revenue is up 9.5%.

Unfortunately, earnings per share have trended lower over the last three years. And the modest revenue growth over 12 months isn't much comfort against the reduced earnings per share. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. It could be important to check this free visual depiction of what analysts expect for the future.

Has Oxford Metrics Plc Been A Good Investment?

Boasting a total shareholder return of 104% over three years, Oxford Metrics Plc has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

We examined the amount Oxford Metrics Plc pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

Earnings per share have not grown in three years, and the revenue growth fails to impress us.

But clearly there are some positives, because investors have done well over the same time frame. So on this analysis we'd stop short of criticizing the level of CEO compensation. So you may want to check if insiders are buying Oxford Metrics shares with their own money (free access).

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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.