Should You Worry About McColl's Retail Group plc's (LON:MCLS) CEO Pay?
In 2016 Jonathan Miller was appointed CEO of McColl's Retail Group plc (LON:MCLS). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
Check out our latest analysis for McColl's Retail Group
How Does Jonathan Miller's Compensation Compare With Similar Sized Companies?
According to our data, McColl's Retail Group plc has a market capitalization of UK£50m, and paid its CEO total annual compensation worth UK£591k over the year to November 2018. While we always look at total compensation first, we note that the salary component is less, at UK£450k. We took a group of companies with market capitalizations below UK£156m, and calculated the median CEO total compensation to be UK£249k.
Thus we can conclude that Jonathan Miller receives more in total compensation than the median of a group of companies in the same market, and of similar size to McColl's Retail Group plc. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see a visual representation of the CEO compensation at McColl's Retail Group, below.
Is McColl's Retail Group plc Growing?
On average over the last three years, McColl's Retail Group plc has shrunk earnings per share by 28% each year (measured with a line of best fit). In the last year, its revenue changed by just 0.9%.
Unfortunately, earnings per share have trended lower over the last three years. And the flat revenue is seriously uninspiring. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Shareholders might be interested in this free visualization of analyst forecasts.
Has McColl's Retail Group plc Been A Good Investment?
With a three year total loss of 72%, McColl's Retail Group plc would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary...
We compared the total CEO remuneration paid by McColl's Retail Group plc, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
Earnings per share have not grown in three years, and the revenue growth fails to impress us. Just as bad, share price gains for investors have failed to materialize, over the same period. In our opinion the CEO might be paid too generously! Whatever your view on compensation, you might want to check if insiders are buying or selling McColl's Retail Group shares (free trial).
Important note: McColl's Retail Group may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE 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.
