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In 2017 Kevin Bradshaw was appointed CEO of Northgate plc (LON:NTG). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
Check out our latest analysis for Northgate
How Does Kevin Bradshaw's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Northgate plc has a market cap of UK£468m, and is paying total annual CEO compensation of UK£490k. (This figure is for the year to April 2018). While we always look at total compensation first, we note that the salary component is less, at UK£408k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of UK£159m to UK£637m. The median total CEO compensation was UK£683k.
That means Kevin Bradshaw receives fairly typical remuneration for the CEO of a company that size. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.
You can see a visual representation of the CEO compensation at Northgate, below.
Is Northgate plc Growing?
On average over the last three years, Northgate plc has shrunk earnings per share by 13% each year (measured with a line of best fit). Its revenue is up 6.2% over last year.
Unfortunately, earnings per share have trended lower over the last three years. The fairly low revenue growth fails to impress given that the earnings per share is down. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. It could be important to check this free visual depiction of what analysts expect for the future.
Has Northgate plc Been A Good Investment?
Northgate plc has served shareholders reasonably well, with a total return of 16% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary...
Remuneration for Kevin Bradshaw is close enough to the median pay for a CEO of a similar sized company .
The company isn't growing earnings per share, and nor have the total returns inspired us. We wouldn't say the CEO pay is too high, but we'd venture the company should look to improve its business metrics (and share price) before paying any more. So you may want to check if insiders are buying Northgate shares with their own money (free access).