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Does APC Technology Group PLC’s (LON:APC) CEO Pay Reflect Performance?

Alexis Guardo

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Richard Hodgson became the CEO of APC Technology Group PLC (LON:APC) in 2015. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. 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 APC Technology Group

How Does Richard Hodgson’s Compensation Compare With Similar Sized Companies?

Our data indicates that APC Technology Group PLC is worth UK£11m, and total annual CEO compensation is UK£259k. (This is based on the year to 2018). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at UK£225k. We looked at a group of companies with market capitalizations under UK£155m, and the median CEO compensation was UK£245k.

That means Richard Hodgson receives fairly typical remuneration for the CEO of a company that size. While this data point isn’t particularly informative alone, it gains more meaning when considered with business performance.

The graphic below shows how CEO compensation at APC Technology Group has changed from year to year.

AIM:APC CEO Compensation February 13th 19

Is APC Technology Group PLC Growing?

APC Technology Group PLC has increased its earnings per share (EPS) by an average of 101% a year, over the last three years (using a line of best fit). It achieved revenue growth of 10% over the last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. It’s also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. You might want to check this free visual report on analyst forecasts for future earnings.

Has APC Technology Group PLC Been A Good Investment?

Since shareholders would have lost about 24% over three years, some APC Technology Group PLC shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary…

Richard Hodgson is paid around the same as most CEOs of similar size companies.

We like that the company is growing EPS, but we find the returns over the last three years to be lacking. Considering the improvement in earnings per share, one could argue that the CEO pay is appropriate, albeit not too low. Whatever your view on compensation, you might want to check if insiders are buying or selling APC Technology Group shares (free trial).

Important note: APC Technology Group may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.