Yahoo Finance Does Journey Energy's (TSE:JOY) CEO Salary Compare Well With Industry Peers?
This article will reflect on the compensation paid to Alex Verge who has served as CEO of Journey Energy Inc. (TSE:JOY) since 2012. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
See our latest analysis for Journey Energy
How Does Total Compensation For Alex Verge Compare With Other Companies In The Industry?
Our data indicates that Journey Energy Inc. has a market capitalization of CA$15m, and total annual CEO compensation was reported as CA$407k for the year to December 2019. We note that's a decrease of 29% compared to last year. We note that the salary portion, which stands at CA$213.6k constitutes the majority of total compensation received by the CEO.
On comparing similar-sized companies in the industry with market capitalizations below CA$268m, we found that the median total CEO compensation was CA$363k. So it looks like Journey Energy compensates Alex Verge in line with the median for the industry. What's more, Alex Verge holds CA$1.3m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2019 | 2018 | Proportion (2019) |
Salary | CA$214k | CA$240k | 53% |
Other | CA$193k | CA$335k | 47% |
Total Compensation | CA$407k | CA$575k | 100% |
On an industry level, roughly 44% of total compensation represents salary and 56% is other remuneration. According to our research, Journey Energy has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
A Look at Journey Energy Inc.'s Growth Numbers
Over the last three years, Journey Energy Inc. has shrunk its earnings per share by 37% per year. In the last year, its revenue is down 13%.
Few shareholders would be pleased to read that earnings have declined. And the fact that revenue is down year on year arguably paints an ugly picture. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has Journey Energy Inc. Been A Good Investment?
Given the total shareholder loss of 83% over three years, many shareholders in Journey Energy Inc. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
As we touched on above, Journey Energy Inc. is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. In the meantime, the company has reported declining earnings growth and shareholder returns over the last three years. It's tough to call out the compensation as inappropriate, but shareholders might not favor a raise before company performance improves.
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. That's why we did some digging and identified 5 warning signs for Journey Energy that you should be aware of before investing.
Switching gears from Journey Energy, 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.
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.
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