We believe the Gama Aviation Plc (LON: GMAA) CEO compensation package needs to be scrutinized

Shareholders probably won’t be too impressed with the disappointing results at Gama Aviation Plc (LON: GMAA) recently. At the upcoming Annual General Meeting on June 29, 2021, shareholders will be able to hear from the Management Board about their plans for the turnaround in performance. You will also be given the opportunity to influence management decision-making by voting on decisions such as executive compensation that may affect company value in the future. We present the case why we believe CEO compensation is inconsistent with company performance.

Check out our latest analysis for Gama Aviation

Compare Gama Aviation Plc’s CEO compensation with the industry

At the time of writing, our data shows that Gama Aviation Plc has a market capitalization of £ 24M and reported total CEO compensation of $ 799,000 for the year ended December 2020. That’s a remarkable 31% increase over the previous year. Notably, the $ 494.2,000 salary makes up most of the total compensation.

For comparison, other companies in the industry with market capitalizations of less than £ 144m reported an average total CEO compensation of $ 597,000. Accordingly, our analysis shows that Gama Aviation Plc pays Marwan Abdel-Khalek north of the industry average. In addition, Marwan Abdel-Khalek directly owns shares in the company valued at £ 5.2 million, which means they are heavily invested in the company’s success.

component 2020 2019 Share (2020)
salary 494 thousand US dollars $ 479 thousand 62%
Other 304 thousand US dollars $ 131,000 38%
Total compensation $ 799,000 $ 611,000 100%

At the industry level, around 53% of total compensation is salary and 47% is other compensation. It is interesting that, compared to the industry, Gama Aviation pays a larger proportion of the remuneration through salaries. If the total remuneration deviates in the direction of the salary, this indicates that the variable, usually performance-related component is lower.

AIM: GMAA CEO compensation June 23, 2021

Growth of Gama Aviation Plc

Gama Aviation Plc has reduced its earnings per share by 111% per year over the past three years. Last year sales fell by 26%.

Overall, this is not a very positive result for shareholders. In addition, there is the fact that sales are actually declining compared to the previous year. Given this relatively poor performance, shareholders probably wouldn’t want to see high compensation for the CEO. While we don’t have any analyst predictions for the company, shareholders should check out this detailed historical graph of earnings, revenue, and cash flow.

Was Gama Aviation Plc a Good Investment?

The return of -81% over three years would not have pleased the shareholders of Gama Aviation Plc. This suggests that paying the CEO too generously would be unwise.


Along with poor business performance, shareholders have suffered from poor stock price returns on their investments, suggesting that there is little to no chance they will advocate a raise for the CEO. At the upcoming AGM, management will have an opportunity to explain how it intends to get the business back on track and address investor concerns.

CEO compensation is simply one of the many factors to consider when studying company performance. In our study we found 3 warning signs for Gama Aviation You should be aware of this, and 1 of them is potentially serious.

Switch from Gama Aviation if you are looking for a pristine balance sheet and great returns, this free The list of high yield, low debt companies is a great place to look.

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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 is sensitive to the price. Simply Wall St has no position in the stocks mentioned.
*Interactive Brokers is rated the cheapest broker by StockBrokers.com

Do you have any feedback on this article? Concerned about the content? Get in touch directly with us. Alternatively, send an email to the editorial team (at) simplywallst.com.

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