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Here's Why Shareholders Will Not Be Complaining About Keyera Corp.'s (TSE:KEY) CEO Pay Packet

Key Insights

  • Keyera to hold its Annual General Meeting on 14th of May

  • CEO C. Setoguchi's total compensation includes salary of CA$700.0k

  • The total compensation is similar to the average for the industry

  • Keyera's EPS grew by 87% over the past three years while total shareholder return over the past three years was 42%

It would be hard to discount the role that CEO C. Setoguchi has played in delivering the impressive results at Keyera Corp. (TSE:KEY) recently. Shareholders will have this at the front of their minds in the upcoming AGM on 14th of May. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. We think the CEO has done a pretty decent job and we discuss why the CEO compensation is appropriate.

View our latest analysis for Keyera

Comparing Keyera Corp.'s CEO Compensation With The Industry

At the time of writing, our data shows that Keyera Corp. has a market capitalization of CA$7.9b, and reported total annual CEO compensation of CA$5.2m for the year to December 2023. We note that's an increase of 8.3% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at CA$700k.

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On examining similar-sized companies in the Canadian Oil and Gas industry with market capitalizations between CA$5.5b and CA$16b, we discovered that the median CEO total compensation of that group was CA$5.1m. So it looks like Keyera compensates C. Setoguchi in line with the median for the industry. What's more, C. Setoguchi holds CA$8.1m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component

2023

2022

Proportion (2023)

Salary

CA$700k

CA$670k

14%

Other

CA$4.5m

CA$4.1m

86%

Total Compensation

CA$5.2m

CA$4.8m

100%

Talking in terms of the industry, salary represented approximately 37% of total compensation out of all the companies we analyzed, while other remuneration made up 63% of the pie. In Keyera's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

ceo-compensation
ceo-compensation

A Look at Keyera Corp.'s Growth Numbers

Keyera Corp.'s earnings per share (EPS) grew 87% per year over the last three years. In the last year, its revenue changed by just 0.1%.

Shareholders would be glad to know that the company has improved itself over the last few years. While it would be good to see revenue growth, profits matter more in the end. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Keyera Corp. Been A Good Investment?

Boasting a total shareholder return of 42% over three years, Keyera Corp. has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 3 warning signs for Keyera you should be aware of, and 1 of them is a bit concerning.

Switching gears from Keyera, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.