Why We Think Shareholders May Be Considering Bumping Up Imperial Metals Corporation's (TSE:III) CEO Compensation

The solid performance at Imperial Metals Corporation (TSE:III) has been impressive and shareholders will probably be pleased to know that CEO J. Kynoch has delivered. This would be kept in mind at the upcoming AGM on 26 May 2021 which will be a chance for them to hear the board review the financial results, discuss future company strategy and vote on resolutions such as executive remuneration and other matters. We think the CEO has done a pretty decent job and probably deserves a well-earned pay rise.

View our latest analysis for Imperial Metals

How Does Total Compensation For J. Kynoch Compare With Other Companies In The Industry?

At the time of writing, our data shows that Imperial Metals Corporation has a market capitalization of CA$659m, and reported total annual CEO compensation of CA$511k for the year to December 2020. Notably, that's an increase of 11% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at CA$244k.

On comparing similar companies from the same industry with market caps ranging from CA$241m to CA$964m, we found that the median CEO total compensation was CA$750k. That is to say, J. Kynoch is paid under the industry median. What's more, J. Kynoch holds CA$6.8m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component

2020

2019

Proportion (2020)

Salary

CA$244k

CA$302k

48%

Other

CA$267k

CA$160k

52%

Total Compensation

CA$511k

CA$461k

100%

On an industry level, around 94% of total compensation represents salary and 6% is other remuneration. In Imperial Metals' case, non-salary compensation represents a greater slice of total remuneration, 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.

ceo-compensationceo-compensation
ceo-compensation

Imperial Metals Corporation's Growth

Imperial Metals Corporation has seen its earnings per share (EPS) increase by 17% a year over the past three years. In the last year, its revenue is up 78%.

Shareholders would be glad to know that the company has improved itself over the last few years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Imperial Metals Corporation Been A Good Investment?

Boasting a total shareholder return of 174% over three years, Imperial Metals Corporation has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary…

Given the improved performance, shareholders may be more forgiving of CEO compensation in the upcoming AGM. However, despite the strong growth in earnings and share price growth, the focus for shareholders would be how the company plans to steer the company towards sustainable profitability in the near future.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 1 warning sign for Imperial Metals that investors should look into moving forward.

Important note: Imperial Metals 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

By Matt Earle

Matthew Earle is the Founder of MiningFeeds. In 2005, Matt founded MiningNerds.com to provide data and information to the mining investment community. This site was merged with Highgrade Review to form MiningFeeds. Matt has a B.Sc. degree with a minor in geology from the University of Toronto.

If you would like to receive our free newsletter via email, simply enter your email address below & click subscribe.

MOST ACTIVE MINING STOCKS

 Daily Gainers

 Lincoln Minerals Limited LML.AX +125.00%
 Golden Cross Resources Ltd. GCR.AX +33.33%
 Casa Minerals Inc. CASA.V +30.00%
 Astro Resources NL ARO.AX +25.00%
 Athena Resources Ltd. AHN.AX +22.22%
 Adavale Resources Limited ADD.AX +22.22%
 Azimut Exploration Inc. AZM.V +21.98%
 New Stratus Energy Inc. NSE.V +21.05%
 Dynasty Gold Corp. DYG.V +18.42%
 Azincourt Energy Corp. AAZ.V +18.18%