It Looks Like Foxtons Group plc's (LON:FOXT) CEO May Expect Their Salary To Be Put Under The Microscope

Shareholders will probably not be too impressed with the underwhelming results at Foxtons Group plc (LON:FOXT) recently. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 22 April 2021. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. We present the case why we think CEO compensation is out of sync with company performance.

See our latest analysis for Foxtons Group

How Does Total Compensation For Nic Budden Compare With Other Companies In The Industry?

According to our data, Foxtons Group plc has a market capitalization of UK£218m, and paid its CEO total annual compensation worth UK£1.6m over the year to December 2020. Notably, that's an increase of 28% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at UK£550k.

For comparison, other companies in the same industry with market capitalizations ranging between UK£145m and UK£580m had a median total CEO compensation of UK£696k. Accordingly, our analysis reveals that Foxtons Group plc pays Nic Budden north of the industry median. What's more, Nic Budden holds UK£296k worth of shares in the company in their own name.

Speaking on an industry level, nearly 54% of total compensation represents salary, while the remainder of 46% is other remuneration. It's interesting to note that Foxtons Group allocates a smaller portion of compensation to salary in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Foxtons Group plc's Growth

Over the last three years, Foxtons Group plc has shrunk its earnings per share by 26% per year. In the last year, its revenue is down 12%.

Overall this is not a very positive result for shareholders. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Foxtons Group plc Been A Good Investment?

With a three year total loss of 15% for the shareholders, Foxtons Group plc would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 1 warning sign for Foxtons Group that investors should be aware of in a dynamic business environment.

Switching gears from Foxtons Group, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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