Gerald Kaye became the CEO of Helical plc (LON:HLCL) in 2016, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Helical pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

Check out our latest analysis for Helical

How Does Total Compensation For Gerald Kaye Compare With Other Companies In The Industry?

According to our data, Helical plc has a market capitalization of UK£494m, and paid its CEO total annual compensation worth UK£2.6m over the year to March 2020. We note that's an increase of 48% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at UK£545k.

In comparison with other companies in the industry with market capitalizations ranging from UK£304m to UK£1.2b, the reported median CEO total compensation was UK£1.1m. This suggests that Gerald Kaye is paid more than the median for the industry. Moreover, Gerald Kaye also holds UK£8.4m worth of Helical stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Talking in terms of the industry, salary represented approximately 54% of total compensation out of all the companies we analyzed, while other remuneration made up 46% of the pie. Helical sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Helical plc's Growth

Over the last three years, Helical plc has shrunk its earnings per share by 1.7% per year. It achieved revenue growth of 8.2% over the last year.

A lack of EPS improvement is not good to see. And the modest revenue growth over 12 months isn't much comfort against the reduced EPS. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Helical plc Been A Good Investment?

We think that the total shareholder return of 46%, over three years, would leave most Helical plc shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

As we touched on above, Helical plc is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. The company isn't growing EPS, but shareholder returns have been impressive over the last three years. So while we would not say that Gerald is generously paid, stockholders would want to see some EPS growth before agreeing that a raise is a good idea.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We did our research and identified 3 warning signs (and 1 which doesn't sit too well with us) in Helical we think you should know about.

Important note: Helical is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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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