Should You Worry About UGE International Ltd.'s (CVE:UGE) CEO Pay?

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Nick Blitterswyk became the CEO of UGE International Ltd. (CVE:UGE) in 2014. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for UGE International

How Does Nick Blitterswyk's Compensation Compare With Similar Sized Companies?

According to our data, UGE International Ltd. has a market capitalization of CA$7.3m, and pays its CEO total annual compensation worth US$148k. (This is based on the year to December 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$80k. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO total compensation in that group is US$107k.

It would therefore appear that UGE International Ltd. pays Nick Blitterswyk more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

The graphic below shows how CEO compensation at UGE International has changed from year to year.

TSXV:UGE CEO Compensation, May 8th 2019
TSXV:UGE CEO Compensation, May 8th 2019

Is UGE International Ltd. Growing?

Over the last three years UGE International Ltd. has grown its earnings per share (EPS) by an average of 29% per year (using a line of best fit). Its revenue is down -18% over last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has UGE International Ltd. Been A Good Investment?

Given the total loss of 81% over three years, many shareholders in UGE International Ltd. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

We examined the amount UGE International Ltd. pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.

However we must not forget that the EPS growth has been very strong over three years. Having said that, shareholders may be disappointed with the weak returns over the last three years. While EPS is positive, we'd say shareholders would want better returns before the CEO is paid much more. Shareholders may want to check for free if UGE International insiders are buying or selling shares.

Important note: UGE International may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.

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