Yahoo Finance We Think Shareholders Are Less Likely To Approve A Large Pay Rise For Elders Limited's (ASX:ELD) CEO For Now
Performance at Elders Limited (ASX:ELD) has been reasonably good and CEO Mark Allison has done a decent job of steering the company in the right direction. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 16 December 2021. However, some shareholders will still be cautious of paying the CEO excessively.
View our latest analysis for Elders
How Does Total Compensation For Mark Allison Compare With Other Companies In The Industry?
Our data indicates that Elders Limited has a market capitalization of AU$1.8b, and total annual CEO compensation was reported as AU$3.0m for the year to September 2021. We note that's an increase of 18% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at AU$1.0m.
On comparing similar companies from the same industry with market caps ranging from AU$1.4b to AU$4.5b, we found that the median CEO total compensation was AU$1.6m. Hence, we can conclude that Mark Allison is remunerated higher than the industry median. Moreover, Mark Allison also holds AU$11m worth of Elders stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2021 | 2020 | Proportion (2021) |
Salary | AU$1.0m | AU$924k | 34% |
Other | AU$1.9m | AU$1.6m | 66% |
Total Compensation | AU$3.0m | AU$2.5m | 100% |
On an industry level, roughly 69% of total compensation represents salary and 31% is other remuneration. It's interesting to note that Elders allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
Elders Limited's Growth
Over the past three years, Elders Limited has seen its earnings per share (EPS) grow by 12% per year. Its revenue is up 22% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Elders Limited Been A Good Investment?
Most shareholders would probably be pleased with Elders Limited for providing a total return of 87% over three years. 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.
In Summary...
Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 2 warning signs for Elders (of which 1 is a bit concerning!) that you should know about in order to have a holistic understanding of the stock.
Switching gears from Elders, 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.
