Gillanders Arbuthnot and Company Limited (NSE: GILLANDERS) has not performed well recently and CEO Manoj Sodhani will likely need to improve his game. Shareholders will be interested in what the board has to say about the performance turnaround at the next general meeting of the August 13, 2021. It will also be an opportunity for them to challenge the board of directors on the direction of the company and to vote on resolutions such as executive compensation. We present the reasons why we believe that CEO compensation is not in line with company performance.
Check out our latest review for Gillanders Arbuthnot
How does Manoj Sodhani’s total compensation compare to other companies in the industry?
At the time of writing, our data shows Gillanders Arbuthnot and Company Limited has a market capitalization of 1.2 billion yen and reported total annual CEO compensation of 7.3 million yen for the year through March. 2021. We note that this is a decrease of 18% compared to last year. Note that the salary portion, which amounts to 6.65 M, constitutes the majority of the total compensation received by the CEO.
Comparing similar sized companies in the industry with market caps below â¹ 15b, we found that the median total CEO compensation was â¹ 9.3m. This suggests that Gillanders Arbuthnot pays its CEO largely in line with the industry average.
|Making up||2021||2020||Proportion (2021)|
At the industry level, approximately 71% of total compensation is salary and 29% is other compensation. Gillanders Arbuthnot pays 91% of the compensation in the form of salary, well above the industry average. If the total compensation is oriented towards the salary, this suggests that the variable part – which is generally linked to performance, is lower.
A look at the growth figures of Gillanders Arbuthnot and Company Limited
Over the past three years, Gillanders Arbuthnot and Company Limited has reduced its earnings per share by 56% per year. Last year, its turnover fell by 35%.
The decline in BPA is a bit worrying. This is made worse by the fact that revenues are actually down compared to last year. So given this relatively weak performance, shareholders probably wouldn’t want high CEO compensation. We don’t have analyst forecasts, but you can better understand its growth by looking at this more detailed historical chart of earnings, income and cash flow.
Was Gillanders Arbuthnot and Company Limited a good investment?
Considering the total shareholder loss of 10% over three years, many shareholders of Gillanders Arbuthnot and Company Limited are probably quite dissatisfied, to say the least. Therefore, it could be upsetting for shareholders if the CEO is paid generously.
Given that shareholders haven’t seen any positive return on their investment, let alone the lack of earnings growth, this may suggest that few of them would be willing to give the CEO a raise. At the next AGM, management will have the opportunity to explain how they plan to get the company back on track and address investor concerns.
While CEO compensation is an important factor to consider, there are other areas that investors should be aware of as well. This is why we have dug and identified 2 warning signs for Gillanders Arbuthnot that you need to know before you invest.
Important note: Gillanders Arbuthnot is exciting stock, but we understand that investors may be looking for an unencumbered balance sheet and exceptional returns. You might find something better in this list of interesting companies with high ROE and low leverage.
When trading Gillanders Arbuthnot or any other investment, use the platform seen by many as the gateway for professionals to the global market, Interactive brokers. You get the cheapest * trading on stocks, options, futures, forex, bonds and funds from around the world from a single integrated account.
This Simply Wall St article is general in nature. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in the mentioned stocks.
*Interactive Brokers Ranked Least Expensive Broker By StockBrokers.com Online Annual Review 2020
Do you have any feedback on this item? Are you worried about the content? Enter into a contract with us directly. You can also send an email to the editorial team (at) simplywallst.com.