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Is Imperial Metals Corporation's (TSE:III) CEO Paid Enough Relative To Peers?

J. Kynoch is the CEO of Imperial Metals Corporation (TSE:III). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.

See our latest analysis for Imperial Metals

How Does J. Kynoch's Compensation Compare With Similar Sized Companies?

According to our data, Imperial Metals Corporation has a market capitalization of CA$167m, and paid its CEO total annual compensation worth CA$285k over the year to December 2018. It is worth noting that the CEO compensation consists almost entirely of the salary, worth CA$275k. We looked at a group of companies with market capitalizations under CA$281m, and the median CEO total compensation was CA$225k.

Next, let's break down remuneration compositions to understand how the industry and company compare with each other. On a sector level, around 92% of total compensation represents salary and 7.8% is other remuneration. Investors will find it interesting that Imperial Metals pays the bulk of its rewards through a traditional salary, instead of non-salary benefits.

That means J. Kynoch receives fairly typical remuneration for the CEO of a company that size. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context. You can see a visual representation of the CEO compensation at Imperial Metals, below.

TSX:III CEO Compensation March 30th 2020
TSX:III CEO Compensation March 30th 2020

Is Imperial Metals Corporation Growing?

On average over the last three years, Imperial Metals Corporation has shrunk earnings per share by 26% each year (measured with a line of best fit). It saw its revenue drop 31% over the last year.

Unfortunately, earnings per share have trended lower over the last three years. 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. You might want to check this free visual report on analyst forecasts for future earnings.

Has Imperial Metals Corporation Been A Good Investment?

With a three year total loss of 79%, Imperial Metals Corporation would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Remuneration for J. Kynoch is close enough to the median pay for a CEO of a similar sized company .

The company isn't growing EPS, and shareholder returns have been disappointing. Suffice it to say, we don't think the CEO is underpaid! Shifting gears from CEO pay for a second, we've picked out 3 warning signs for Imperial Metals that investors should be aware of in a dynamic business environment.

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.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

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