Australia markets open in 1 hour 35 minutes
  • ALL ORDS

    7,114.50
    -133.60 (-1.84%)
     
  • AUD/USD

    0.7030
    -0.0090 (-1.26%)
     
  • ASX 200

    6,838.30
    -123.30 (-1.77%)
     
  • OIL

    87.07
    -0.28 (-0.32%)
     
  • GOLD

    1,794.80
    -34.90 (-1.91%)
     
  • BTC-AUD

    50,855.55
    -2,013.73 (-3.81%)
     
  • CMC Crypto 200

    808.71
    -10.80 (-1.32%)
     

Here's Why Shareholders Should Examine Cue Energy Resources Limited's (ASX:CUE) CEO Compensation Package More Closely

  • Oops!
    Something went wrong.
    Please try again later.
·3-min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • CUE.AX

Cue Energy Resources Limited (ASX:CUE) has not performed well recently and CEO Matthew Boyall will probably need to up their game. At the upcoming AGM on 27 October 2021, shareholders can hear from the board including their plans for turning around performance. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. From our analysis, we think CEO compensation may need a review in light of the recent performance.

Check out our latest analysis for Cue Energy Resources

How Does Total Compensation For Matthew Boyall Compare With Other Companies In The Industry?

At the time of writing, our data shows that Cue Energy Resources Limited has a market capitalization of AU$52m, and reported total annual CEO compensation of AU$514k for the year to June 2021. We note that's a small decrease of 5.8% on last year. We note that the salary portion, which stands at AU$356.7k constitutes the majority of total compensation received by the CEO.

On comparing similar-sized companies in the industry with market capitalizations below AU$267m, we found that the median total CEO compensation was AU$289k. Accordingly, our analysis reveals that Cue Energy Resources Limited pays Matthew Boyall north of the industry median.

Component

2021

2020

Proportion (2021)

Salary

AU$357k

AU$356k

69%

Other

AU$157k

AU$189k

31%

Total Compensation

AU$514k

AU$545k

100%

Speaking on an industry level, nearly 71% of total compensation represents salary, while the remainder of 29% is other remuneration. There isn't a significant difference between Cue Energy Resources and the broader market, in terms of salary allocation in the overall compensation package. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

ceo-compensation
ceo-compensation

Cue Energy Resources Limited's Growth

Over the last three years, Cue Energy Resources Limited has shrunk its earnings per share by 105% per year. In the last year, its revenue is down 6.1%.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Cue Energy Resources Limited Been A Good Investment?

With a three year total loss of 5.1% for the shareholders, Cue Energy Resources Limited would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 1 warning sign for Cue Energy Resources that investors should be aware of in a dynamic business environment.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting