This Is Why Shareholders May Want To Hold Back On A Pay Rise For CIBT Education Group Inc.'s (TSE:MBA) CEO

The underwhelming performance at CIBT Education Group Inc. (TSE:MBA) recently has probably not pleased shareholders. The next AGM coming up on 28 January 2022 will be a chance for shareholders to have their concerns addressed by the board, challenge management on company strategy and vote on resolutions such as executive remuneration, which may help change the company's future prospects. The data we gathered below shows that CEO compensation looks acceptable for now.

View our latest analysis for CIBT Education Group

How Does Total Compensation For Toby Chu Compare With Other Companies In The Industry?

Our data indicates that CIBT Education Group Inc. has a market capitalization of CA$44m, and total annual CEO compensation was reported as CA$423k for the year to August 2021. That's a notable increase of 40% on last year. In particular, the salary of CA$264.0k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the industry with market capitalizations below CA$251m, we found that the median total CEO compensation was CA$806k. That is to say, Toby Chu is paid under the industry median. What's more, Toby Chu holds CA$5.9m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Talking in terms of the industry, salary represented approximately 62% of total compensation out of all the companies we analyzed, while other remuneration made up 38% of the pie. Our data reveals that CIBT Education Group allocates salary more or less in line with the wider market. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

CIBT Education Group Inc.'s Growth

Over the last three years, CIBT Education Group Inc. has shrunk its earnings per share by 40% per year. Its revenue is up 6.2% over the last year.

Overall this is not a very positive result for shareholders. And the modest revenue growth over 12 months isn't much comfort against the reduced EPS. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has CIBT Education Group Inc. Been A Good Investment?

Since shareholders would have lost about 8.7% over three years, some CIBT Education Group Inc. investors would surely be feeling negative emotions. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 4 warning signs for CIBT Education Group (2 shouldn't be ignored!) that you should be aware of before investing here.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.