Yahoo Finance Here's Why It's Unlikely That Equinox Gold Corp.'s (TSE:EQX) CEO Will See A Pay Rise This Year
Key Insights
Equinox Gold will host its Annual General Meeting on 9th of May
Salary of US$626.1k is part of CEO Greg Smith's total remuneration
Total compensation is similar to the industry average
Equinox Gold's three-year loss to shareholders was 28% while its EPS was down 11% over the past three years
The results at Equinox Gold Corp. (TSE:EQX) have been quite disappointing recently and CEO Greg Smith bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 9th of May. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. We present the case why we think CEO compensation is out of sync with company performance.
View our latest analysis for Equinox Gold
Comparing Equinox Gold Corp.'s CEO Compensation With The Industry
At the time of writing, our data shows that Equinox Gold Corp. has a market capitalization of CA$2.9b, and reported total annual CEO compensation of US$3.2m for the year to December 2023. Notably, that's an increase of 38% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$626k.
In comparison with other companies in the Canadian Metals and Mining industry with market capitalizations ranging from CA$1.4b to CA$4.4b, the reported median CEO total compensation was US$2.6m. From this we gather that Greg Smith is paid around the median for CEOs in the industry. Furthermore, Greg Smith directly owns CA$2.7m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$626k | US$582k | 20% |
Other | US$2.5m | US$1.7m | 80% |
Total Compensation | US$3.2m | US$2.3m | 100% |
On an industry level, around 94% of total compensation represents salary and 6% is other remuneration. Equinox Gold sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
A Look at Equinox Gold Corp.'s Growth Numbers
Over the last three years, Equinox Gold Corp. has shrunk its earnings per share by 11% per year. Its revenue is up 14% over the last year.
Few shareholders would be pleased to read that EPS have declined. While the revenue growth is good to see, it is outweighed by the fact that EPS are down, over three years. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Equinox Gold Corp. Been A Good Investment?
Given the total shareholder loss of 28% over three years, many shareholders in Equinox Gold Corp. are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
In Summary...
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.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 2 warning signs for Equinox Gold that investors should be aware of in a dynamic business environment.
Switching gears from Equinox Gold, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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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.
