Yahoo Finance How Does Emmerson Resources' (ASX:ERM) CEO Salary Compare to Peers?
Rob Bills has been the CEO of Emmerson Resources Limited (ASX:ERM) since 2007, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Emmerson Resources pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
View our latest analysis for Emmerson Resources
How Does Total Compensation For Rob Bills Compare With Other Companies In The Industry?
Our data indicates that Emmerson Resources Limited has a market capitalization of AU$42m, and total annual CEO compensation was reported as AU$511k for the year to June 2020. We note that's an increase of 28% above last year. In particular, the salary of AU$338.6k, makes up a huge portion of the total compensation being paid to the CEO.
In comparison with other companies in the industry with market capitalizations under AU$277m, the reported median total CEO compensation was AU$310k. Hence, we can conclude that Rob Bills is remunerated higher than the industry median. Moreover, Rob Bills also holds AU$689k worth of Emmerson Resources stock directly under their own name.
Component | 2020 | 2019 | Proportion (2020) |
Salary | AU$339k | AU$368k | 66% |
Other | AU$173k | AU$30k | 34% |
Total Compensation | AU$511k | AU$398k | 100% |
On an industry level, around 70% of total compensation represents salary and 30% is other remuneration. Our data reveals that Emmerson Resources allocates salary more or less in line with the wider market. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
Emmerson Resources Limited's Growth
Over the past three years, Emmerson Resources Limited has seen its earnings per share (EPS) grow by 60% per year. In the last year, its revenue is up 75%.
Shareholders would be glad to know that the company has improved itself over the last few years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Emmerson Resources Limited Been A Good Investment?
Emmerson Resources Limited has not done too badly by shareholders, with a total return of 1.1%, over three years. 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.
In Summary...
As we noted earlier, Emmerson Resources pays its CEO higher than the norm for similar-sized companies belonging to the same industry. However, the EPS growth over three years is certainly impressive. Looking at the same time period, we think that the shareholder returns are respectable. So, considering the EPS growth we do not wish to criticize CEO compensation, though we'd recommend further research on management.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 4 warning signs for Emmerson Resources (1 doesn't sit too well with us!) that you should be aware of before investing here.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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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