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It would be hard to discount the role that CEO Mike Robb has played in delivering the impressive results at AirIQ Inc. (CVE:IQ) recently. Coming up to the next AGM on 29 September 2021, shareholders would be keeping this in mind. It is likely that the focus will be on company strategy going forward as shareholders hear from the board and cast their votes on resolutions such as executive remuneration and other matters. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.
How Does Total Compensation For Mike Robb Compare With Other Companies In The Industry?
Our data indicates that AirIQ Inc. has a market capitalization of CA$8.7m, and total annual CEO compensation was reported as CA$225k for the year to March 2021. We note that's an increase of 19% above last year. In particular, the salary of CA$156.3k, makes up a huge portion of the total compensation being paid to the CEO.
On comparing similar-sized companies in the industry with market capitalizations below CA$255m, we found that the median total CEO compensation was CA$195k. From this we gather that Mike Robb is paid around the median for CEOs in the industry. Furthermore, Mike Robb directly owns CA$237k worth of shares in the company.
Speaking on an industry level, nearly 79% of total compensation represents salary, while the remainder of 21% is other remuneration. In AirIQ's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
A Look at AirIQ Inc.'s Growth Numbers
Over the past three years, AirIQ Inc. has seen its earnings per share (EPS) grow by 31% per year. Its revenue is down 7.4% over the previous year.
Shareholders would be glad to know that the company has improved itself over the last few years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has AirIQ Inc. Been A Good Investment?
Boasting a total shareholder return of 81% over three years, AirIQ Inc. 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.
Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 4 warning signs for AirIQ (2 can't be ignored!) that you should be aware of before investing here.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.
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.
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