The results at Navigator Global Investments Limited (ASX:NGI) have been quite disappointing recently and CEO Sean McGould bears some responsibility for this. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 16 November 2022. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. From our analysis, we think CEO compensation may need a review in light of the recent performance.

See our latest analysis for Navigator Global Investments

Comparing Navigator Global Investments Limited's CEO Compensation With The Industry

According to our data, Navigator Global Investments Limited has a market capitalization of AU$276m, and paid its CEO total annual compensation worth US$1.1m over the year to June 2022. We note that's a decrease of 26% compared to last year. In particular, the salary of US$689.0k, 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 AU$155m to AU$620m, the reported median CEO total compensation was US$700k. Accordingly, our analysis reveals that Navigator Global Investments Limited pays Sean McGould north of the industry median. Furthermore, Sean McGould directly owns AU$23m worth of shares in the company, implying that they are deeply invested in the company's success.

Component 2022 2021 Proportion (2022) Salary US$689k US$1.0m 65% Other US$373k US$440k 35% Total Compensation US$1.1m US$1.4m 100%

Speaking on an industry level, nearly 59% of total compensation represents salary, while the remainder of 41% is other remuneration. Navigator Global Investments is paying a higher share of its remuneration through a salary in comparison to the overall industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

 ceo-compensation

A Look at Navigator Global Investments Limited's Growth Numbers

Navigator Global Investments Limited saw earnings per share stay pretty flat over the last three years. It saw its revenue drop 5.6% over the last year.

The lack of EPS growth is certainly uninspiring. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Navigator Global Investments Limited Been A Good Investment?

The return of -45% over three years would not have pleased Navigator Global Investments Limited shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 3 warning signs for Navigator Global Investments that you should be aware of before investing.

Important note: Navigator Global Investments 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.

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