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The performance at ITM Power Plc (LON:ITM) has been rather lacklustre of late and shareholders may be wondering what CEO Graham Cooley is planning to do about this. One way they can exercise their influence on management is through voting on resolutions, such as executive remuneration at the next AGM, coming up on 29 October 2021. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. We have prepared some analysis below to show that CEO compensation looks to be reasonable.
Check out our latest analysis for ITM Power
How Does Total Compensation For Graham Cooley Compare With Other Companies In The Industry?
Our data indicates that ITM Power Plc has a market capitalization of UK£2.5b, and total annual CEO compensation was reported as UK£500k for the year to April 2021. That's a notable increase of 45% on last year. In particular, the salary of UK£311.0k, makes up a huge portion of the total compensation being paid to the CEO.
In comparison with other companies in the industry with market capitalizations ranging from UK£1.5b to UK£4.6b, the reported median CEO total compensation was UK£1.4m. In other words, ITM Power pays its CEO lower than the industry median. Furthermore, Graham Cooley directly owns UK£3.3m worth of shares in the company, implying that they are deeply invested in the company's success.
| Component | 2021 | 2020 | Proportion (2021) |
| Salary | UK£311k | UK£214k | 62% |
| Other | UK£189k | UK£132k | 38% |
| Total Compensation | UK£500k | UK£346k | 100% |
On an industry level, around 61% of total compensation represents salary and 39% is other remuneration. There isn't a significant difference between ITM Power and the broader market, in terms of salary allocation in the overall compensation package. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
ITM Power Plc's Growth
Over the last three years, ITM Power Plc has shrunk its earnings per share by 37% per year. Its revenue is up 12% over the last year.
The decline in EPS is a bit concerning. There's no doubt that the silver lining is that revenue is up. But it isn't sufficiently fast growth to overlook the fact that EPS has gone backwards over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..