Yahoo Finance Here's Why Shareholders Will Not Be Complaining About Home Consortium Limited's (ASX:HMC) CEO Pay Packet
The performance at Home Consortium Limited (ASX:HMC) has been quite strong recently and CEO David Di Pilla has played a role in it. Shareholders will have this at the front of their minds in the upcoming AGM on 22 November 2022. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. We think the CEO has done a pretty decent job and we discuss why the CEO compensation is appropriate.
Check out our latest analysis for Home Consortium
Comparing Home Consortium Limited's CEO Compensation With The Industry
At the time of writing, our data shows that Home Consortium Limited has a market capitalization of AU$1.5b, and reported total annual CEO compensation of AU$1.7m for the year to June 2022. We note that's an increase of 72% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at AU$682k.
For comparison, other companies in the same industry with market capitalizations ranging between AU$590m and AU$2.4b had a median total CEO compensation of AU$1.6m. So it looks like Home Consortium compensates David Di Pilla in line with the median for the industry. Furthermore, David Di Pilla directly owns AU$41m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2022 | 2021 | Proportion (2022) |
Salary | AU$682k | AU$487k | 41% |
Other | AU$977k | AU$477k | 59% |
Total Compensation | AU$1.7m | AU$964k | 100% |
On an industry level, around 40% of total compensation represents salary and 60% is other remuneration. Home Consortium is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
A Look at Home Consortium Limited's Growth Numbers
Home Consortium Limited's funds from operations (FFO) grew 149% over the last one year. It achieved revenue growth of 112% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. The combination of strong revenue growth with medium-term FFO improvement certainly points to the kind of growth we like to see. 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 Home Consortium Limited Been A Good Investment?
Boasting a total shareholder return of 39% over three years, Home Consortium Limited has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
To Conclude...
Some shareholders will probably be more lenient on CEO compensation in the upcoming AGM given the pleasing performance of the company recently. However, despite the strong growth in earnings and share price growth, the focus for shareholders would be how the company plans to steer the company towards sustainable profitability in the near future.
CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Home Consortium that investors should think about before committing capital to this stock.
Important note: Home Consortium 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
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