Yahoo Finance Shareholders Will Probably Be Cautious Of Increasing Melcor Developments Ltd.'s (TSE:MRD) CEO Compensation At The Moment
Key Insights
Melcor Developments' Annual General Meeting to take place on 25th of June
Total pay for CEO Tim Melton includes CA$300.0k salary
Total compensation is similar to the industry average
Melcor Developments' total shareholder return over the past three years was 2.3% while its EPS grew by 52% over the past three years
Under the guidance of CEO Tim Melton, Melcor Developments Ltd. (TSE:MRD) has performed reasonably well recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 25th of June. Here is our take on why we think the CEO compensation looks appropriate.
Check out our latest analysis for Melcor Developments
How Does Total Compensation For Tim Melton Compare With Other Companies In The Industry?
At the time of writing, our data shows that Melcor Developments Ltd. has a market capitalization of CA$355m, and reported total annual CEO compensation of CA$1.3m for the year to December 2023. Notably, that's an increase of 10% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at CA$300k.
For comparison, other companies in the Canadian Real Estate industry with market capitalizations ranging between CA$137m and CA$549m had a median total CEO compensation of CA$996k. From this we gather that Tim Melton is paid around the median for CEOs in the industry. Furthermore, Tim Melton directly owns CA$27m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2023 | 2022 | Proportion (2023) |
Salary | CA$300k | CA$280k | 24% |
Other | CA$973k | CA$876k | 76% |
Total Compensation | CA$1.3m | CA$1.2m | 100% |
On an industry level, roughly 59% of total compensation represents salary and 41% is other remuneration. It's interesting to note that Melcor Developments allocates a smaller portion of compensation to salary in comparison to the broader 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 Melcor Developments Ltd.'s Growth Numbers
Over the past three years, Melcor Developments Ltd. has seen its earnings per share (EPS) grow by 52% per year. Its revenue is up 46% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. 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 Melcor Developments Ltd. Been A Good Investment?
With a total shareholder return of 2.3% over three years, Melcor Developments Ltd. has done okay by shareholders, but there's always room for improvement. Accordingly, a proposal to increase CEO remuneration without seeing an improvement in shareholder returns might not be met favorably by most shareholders.
In Summary...
The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 4 warning signs for Melcor Developments (1 is a bit concerning!) that you should be aware of before investing here.
Important note: Melcor Developments 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
