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We Think Shareholders Will Probably Be Generous With Breville Group Limited's (ASX:BRG) CEO Compensation

·3 min read

We have been pretty impressed with the performance at Breville Group Limited (ASX:BRG) recently and CEO Jim Clayton deserves a mention for their role in it. Coming up to the next AGM on 10 November 2021, shareholders would be keeping this in mind. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. Here is our take on why we think CEO compensation is not extravagant.

See our latest analysis for Breville Group

How Does Total Compensation For Jim Clayton Compare With Other Companies In The Industry?

According to our data, Breville Group Limited has a market capitalization of AU$4.2b, and paid its CEO total annual compensation worth AU$3.6m over the year to June 2021. Notably, that's an increase of 57% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at AU$980k.

On comparing similar companies from the same industry with market caps ranging from AU$2.7b to AU$8.6b, we found that the median CEO total compensation was AU$3.6m. So it looks like Breville Group compensates Jim Clayton in line with the median for the industry. What's more, Jim Clayton holds AU$7.0m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component

2021

2020

Proportion (2021)

Salary

AU$980k

AU$889k

27%

Other

AU$2.6m

AU$1.4m

73%

Total Compensation

AU$3.6m

AU$2.3m

100%

On an industry level, roughly 48% of total compensation represents salary and 52% is other remuneration. It's interesting to note that Breville Group allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

ceo-compensation
ceo-compensation

Breville Group Limited's Growth

Over the past three years, Breville Group Limited has seen its earnings per share (EPS) grow by 13% per year. Its revenue is up 25% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. 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 Breville Group Limited Been A Good Investment?

Most shareholders would probably be pleased with Breville Group Limited for providing a total return of 151% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Breville Group that you should be aware of before investing.

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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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 (at) simplywallst.com.