Here's What We Learned About The CEO Pay At TClarke plc (LON:CTO)

This article will reflect on the compensation paid to Mark Lawrence who has served as CEO of TClarke plc (LON:CTO) since 2010. This analysis will also assess whether TClarke pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for TClarke

Comparing TClarke plc's CEO Compensation With the industry

Our data indicates that TClarke plc has a market capitalization of UK£37m, and total annual CEO compensation was reported as UK£1.1m for the year to December 2019. We note that's an increase of 8.5% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at UK£314k.

For comparison, other companies in the industry with market capitalizations below UK£155m, reported a median total CEO compensation of UK£355k. Hence, we can conclude that Mark Lawrence is remunerated higher than the industry median. Furthermore, Mark Lawrence directly owns UK£192k worth of shares in the company.

On an industry level, around 63% of total compensation represents salary and 37% is other remuneration. TClarke sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

TClarke plc's Growth

TClarke plc has reduced its earnings per share by 2.6% a year over the last three years. In the last year, its revenue is down 22%.

The lack of EPS growth is certainly unimpressive. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet 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 TClarke plc Been A Good Investment?

With a total shareholder return of 19% over three years, TClarke plc shareholders would, in general, be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

To Conclude...

As previously discussed, Mark is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Meanwhile, EPS has not been growing sufficiently to impress us, over the last three years. And shareholder returns are decent but not great. So you may want to delve deeper, because we don't think the amount Mark makes is justifiable.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 5 warning signs for TClarke that investors should think about before committing capital to this stock.

Important note: TClarke 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.

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. 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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