Increasing the remuneration of the CEO of WH Ireland Group plc (LON: WHI) could cool off for now

The overwhelming price development of WH Ireland Group plc (LON: WHI) would have disappointed many shareholders in the past three years. What is unusual, however, is that EPS growth was positive, suggesting that the stock price has deviated from fundamentals. These are some of the concerns shareholders would like to address at the next AGM on August 12, 2021. Voting on resolutions such as board remuneration and other matters could also be a way of influencing management. We believe shareholders may be hesitant about raising the CEO’s compensation right now, as our analysis below shows.

Check out our latest analysis for WH Ireland Group

Compare WH Ireland Group plc CEO compensation against the industry

According to our data, WH Ireland Group plc has a market capitalization of £ 34m and paid its CEO total annual compensation of £ 381,000 through March 2021. That is a slight decrease of 3.7% compared to the previous year. Please note that the salary component of £ 266.7 thousand makes up the majority of the CEO’s total compensation.

Compared to other companies in the industry with market capitalizations of less than £ 144m, the reported average total CEO compensation was £ 173,000. This suggests Phillip Wale is getting paid more than the industry median. In addition, Phillip Wale owns shares of the company valued at £ 92,000 on his own behalf.

In terms of the industry, salaries made up about 51% of total compensation for all of the companies we analyzed, while other compensation made up 49% of the pie. It is interesting to note that the WH Ireland Group pays a larger proportion of the compensation through salary compared to the industry. If salary is the main component of total compensation, it suggests that the CEO receive a higher fixed portion of total compensation regardless of performance.

A look at the growth numbers for WH Ireland Group plc

Over the past three years, WH Ireland Group plc’s earnings per share (EPS) has increased 44% per year. It achieved 37% sales growth last year.

Shareholders would be happy if the company has improved over the past few years. The combination of strong sales growth and mid-term EPS improvement certainly indicates the type of growth we like to see. While we don’t have analyst predictions, it’s worth evaluating this data-rich visualization of earnings, sales, and cash flow.

Was WH Ireland Group plc a good investment?

The -49% return over three years would not have pleased the shareholders of WH Ireland Group plc. This suggests that paying the CEO too generously would be unwise.

Conclude…

Shareholders have not seen their shares increase in value, but rather their shares have fallen. The fact that the stock price has not risen with earnings may suggest that other issues could affect this stock. Shareholders would likely be interested in finding out what other factors could weigh on the stock. The upcoming Annual General Meeting offers shareholders the opportunity to question the Executive Board on important topics such as CEO compensation or other questions and to reconsider their investment thesis in relation to the company.

While it’s important to look out for CEO compensation, investors should also consider other elements of the business. We researched and discovered 3 warning signs for the WH Ireland Group that investors should look to the future.

Important NOTE: WH Ireland Group is an exciting stock, but we understand investors are looking for an unencumbered balance sheet and blockbuster returns. Maybe you can find something better on this list of interesting companies with high ROE and low debt.

Funded
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This article from Simply Wall St is of a general nature. It is not a recommendation to buy or sell stocks and does not take into account your goals or your financial situation. Our goal is to provide you with long-term, focused analysis based on fundamentals. Note that our analysis may not take into account the latest company announcements or quality material, which may be sensitive to the price. Simply Wall St has no position in the stocks mentioned.
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