Yahoo Finance What We Learned About Kainos Group's (LON:KNOS) CEO Pay
Brendan Mooney became the CEO of Kainos Group plc (LON:KNOS) in 2001, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
Check out our latest analysis for Kainos Group
How Does Total Compensation For Brendan Mooney Compare With Other Companies In The Industry?
According to our data, Kainos Group plc has a market capitalization of UK£1.6b, and paid its CEO total annual compensation worth UK£683k over the year to March 2020. We note that's a decrease of 34% compared to last year. We think total compensation is more important but our data shows that the CEO salary is lower, at UK£220k.
On comparing similar companies from the same industry with market caps ranging from UK£768m to UK£2.5b, we found that the median CEO total compensation was UK£861k. So it looks like Kainos Group compensates Brendan Mooney in line with the median for the industry. What's more, Brendan Mooney holds UK£180m 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 | UK£220k | UK£220k | 32% |
Other | UK£463k | UK£816k | 68% |
Total Compensation | UK£683k | UK£1.0m | 100% |
Speaking on an industry level, nearly 68% of total compensation represents salary, while the remainder of 32% is other remuneration. Kainos Group pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
A Look at Kainos Group plc's Growth Numbers
Over the past three years, Kainos Group plc has seen its earnings per share (EPS) grow by 20% per year. In the last year, its revenue is up 18%.
Shareholders would be glad to know that the company has improved itself over the last few years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Kainos Group plc Been A Good Investment?
Boasting a total shareholder return of 370% over three years, Kainos Group plc has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
To Conclude...
As previously discussed, Brendan is compensated close to the median for companies of its size, and which belong to the same industry. Few would be critical of the leadership, since returns have been juicy and EPS are moving in the right direction. Indeed, many might consider that Brendan is compensated rather modestly, given the solid company performance! Also, such solid returns might lead to shareholders warming to the idea of a bump in pay.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 3 warning signs for Kainos Group you should be aware of, and 1 of them is a bit concerning.
Important note: Kainos Group 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.
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