The impressive results at Beeks Trading Corporation Ltd. (LON:BKS) recently will be great news for shareholders. This would be kept in mind at the upcoming AGM on 23 April 2021 which will be a chance for them to hear the board review the financial results, discuss future company strategy and vote on resolutions such as executive remuneration and other matters. Here we will show why we think CEO compensation is appropriate and discuss the case for a pay rise.

Check out our latest analysis for Beeks Trading

How Does Total Compensation For Gordon McArthur Compare With Other Companies In The Industry?

At the time of writing, our data shows that Beeks Trading Corporation Ltd. has a market capitalization of UK£65m, and reported total annual CEO compensation of UK£62k for the year to June 2020. Notably, that's a decrease of 22% over the year before. In particular, the salary of UK£60.0k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the industry with market capitalizations under UK£145m, the reported median total CEO compensation was UK£251k. That is to say, Gordon McArthur is paid under the industry median. Moreover, Gordon McArthur also holds UK£35m worth of Beeks Trading stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, around 67% of total compensation represents salary and 33% is other remuneration. Investors will find it interesting that Beeks Trading pays the bulk of its rewards through a traditional salary, instead of non-salary benefits. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Beeks Trading Corporation Ltd.'s Growth Numbers

Over the past three years, Beeks Trading Corporation Ltd. has seen its earnings per share (EPS) grow by 86% per year. In the last year, its revenue is up 29%.

This demonstrates that the company has been improving recently and is good news for the shareholders. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Beeks Trading Corporation Ltd. Been A Good Investment?

Most shareholders would probably be pleased with Beeks Trading Corporation Ltd. for providing a total return of 115% 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...

Beeks Trading pays its CEO a majority of compensation through a salary. Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 4 warning signs for Beeks Trading (of which 1 makes us a bit uncomfortable!) that you should know about in order to have a holistic understanding of the stock.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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. 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.

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