Performance at United Utilities Group PLC (LON: UU.) Has been reasonably good and CEO Steve Mogford has done a good job of steering the company in the right direction. With shareholders attending the upcoming AGM on July 23, 2021, the focus will likely not be on board compensation, but rather on the steps management will take to continue the growth momentum. We present our case on why we think CEO compensation is fair.
Check out our latest analysis for the United Utilities Group
United Utilities Group PLC’s CEO compensation compared to the industry
According to our data, United Utilities Group PLC has a market capitalization of Â£ 7.1 billion and paid its CEO total annual compensation of Â£ 2.9 million through the year through March 2021. We find that this is an 11% increase over the previous year. While this analysis focuses on total compensation, it should be recognized that the salary component is lower and is estimated at Â£ 736,000.
Comparing similar companies in the industry with market capitalizations over Â£ 5.8 billion, we found that the average total CEO compensation was Â£ 2.9 million. So it looks like the United Utilities Group is compensating Steve Mogford in line with the industry average. In addition, Steve Mogford directly owns shares in the company valued at Â£ 2.1 million.
|salary||â¬ 736,000||Â£ 769k||25%|
|Other||Great Britain Â£ 2.2m||Â£ 1.9m||75%|
|Total compensation||Â£ 2.9m||UK Â£ 2.7m||100%|
At the industry level, around 54% of total compensation is paid to salaries and 46% to other compensation. The United Utilities Group pays a modest portion of the compensation through salary compared to the broader industry. If total compensation is geared towards non-salary performance, it indicates that CEO compensation is tied to company performance.
United Utilities Group PLC PLC grows
For the past three years, United Utilities Group PLC’s earnings per share (EPS) has increased 8.5% per year. Sales are 2.8% below the previous year.
We’d argue that last year’s lack of sales growth isn’t ideal, but it’s good to see at least modest EPS growth. It is difficult to make a statement about the development of the business at the moment. This can possibly be observed. If you step away from the current shape for a second, this free visual representation of. to check what analysts expect for the future.
Was United Utilities Group PLC a good investment?
We believe that the total return for shareholders of 66% over three years makes most United Utilities Group PLC shareholders smile. As a result, some may believe that the CEO should be paid more than is common in companies of similar size.
Given that the company’s overall performance has been reasonable, the CEO’s compensation policy may not be the focus of shareholder interest at the upcoming AGM. However, we continue to believe that any proposed increases in CEO compensation will be carefully reviewed to ensure that compensation is appropriate and performance related.
We can learn a lot about a company by studying CEO compensation trends and looking at other aspects of the business. We researched and identified 4 warning signs (and 2 that shouldn’t be ignored) in the United Utilities Group, which we think you should know about.
Important NOTE: United Utilities Group is exciting stock, but we understand investors are looking for an unencumbered balance sheet and blockbuster returns. Maybe you will find something better on this list of interesting companies with high ROE and low debt.
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