Key Insights

• First Hydrogen's Annual General Meeting to take place on 14th of November

• Salary of CA$480.0k is part of CEO Balraj Mann's total remuneration

• The total compensation is 48% higher than the average for the industry

• First Hydrogen's total shareholder return over the past three years was 596% while its EPS was down 60% over the past three years

The share price of First Hydrogen Corp. (CVE:FHYD) has increased significantly over the past few years. However, the earnings growth has not kept up with the share price momentum, suggesting that some other factors may be driving the price direction. These concerns will be at the front of shareholders' minds as they go into the AGM coming up on 14th of November. They will be able to influence managerial decisions through the exercise of their voting power on resolutions, such as CEO remuneration and other matters, which may influence future company prospects. From the data that we gathered, we think that shareholders should hold off on a raise on CEO compensation until performance starts to show some improvement.

Check out our latest analysis for First Hydrogen

Comparing First Hydrogen Corp.'s CEO Compensation With The Industry

According to our data, First Hydrogen Corp. has a market capitalization of CA$141m, and paid its CEO total annual compensation worth CA$480k over the year to March 2023. Notably, that's an increase of 13% over the year before. Notably, the salary of CA$480k is the entirety of the CEO compensation.

In comparison with other companies in the Canadian Machinery industry with market capitalizations under CA$274m, the reported median total CEO compensation was CA$325k. Accordingly, our analysis reveals that First Hydrogen Corp. pays Balraj Mann north of the industry median. Furthermore, Balraj Mann directly owns CA$1.4m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, roughly 85% of total compensation represents salary and 15% is other remuneration. At the company level, First Hydrogen pays Balraj Mann solely through a salary, preferring to go down a conventional route. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at First Hydrogen Corp.'s Growth Numbers

First Hydrogen Corp. has reduced its earnings per share by 60% a year over the last three years. It has seen most of its revenue evaporate over the past year.

Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has First Hydrogen Corp. Been A Good Investment?

Boasting a total shareholder return of 596% over three years, First Hydrogen Corp. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

First Hydrogen rewards its CEO solely through a salary, ignoring non-salary benefits completely. Despite the strong returns on shareholders' investments, the fact that earnings have failed to grow makes us skeptical about the stock keeping up its current momentum. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We identified 3 warning signs for First Hydrogen (2 shouldn't be ignored!) that you should be aware of before investing here.

Important note: First Hydrogen 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.

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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.