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We Take A Look At Why Ampol Limited's (ASX:ALD) CEO Has Earned Their Pay Packet

Key Insights

  • Ampol to hold its Annual General Meeting on 9th of May

  • Salary of AU$1.86m is part of CEO Matt Halliday's total remuneration

  • The overall pay is comparable to the industry average

  • Ampol's EPS grew by 31% over the past three years while total shareholder return over the past three years was 62%

It would be hard to discount the role that CEO Matt Halliday has played in delivering the impressive results at Ampol Limited (ASX:ALD) recently. Shareholders will have this at the front of their minds in the upcoming AGM on 9th of May. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. Here is our take on why we think CEO compensation is not extravagant.

See our latest analysis for Ampol

How Does Total Compensation For Matt Halliday Compare With Other Companies In The Industry?

At the time of writing, our data shows that Ampol Limited has a market capitalization of AU$8.5b, and reported total annual CEO compensation of AU$5.9m for the year to December 2023. We note that's an increase of 14% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at AU$1.9m.

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On comparing similar companies from the Australian Oil and Gas industry with market caps ranging from AU$6.1b to AU$18b, we found that the median CEO total compensation was AU$5.8m. This suggests that Ampol remunerates its CEO largely in line with the industry average. Furthermore, Matt Halliday directly owns AU$9.7m worth of shares in the company, implying that they are deeply invested in the company's success.

Component

2023

2022

Proportion (2023)

Salary

AU$1.9m

AU$1.9m

31%

Other

AU$4.1m

AU$3.3m

69%

Total Compensation

AU$5.9m

AU$5.2m

100%

Speaking on an industry level, nearly 64% of total compensation represents salary, while the remainder of 36% is other remuneration. Ampol pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

ceo-compensation
ceo-compensation

A Look at Ampol Limited's Growth Numbers

Over the past three years, Ampol Limited has seen its earnings per share (EPS) grow by 31% per year. Its revenue is down 1.9% over the previous year.

This demonstrates that the company has been improving recently and is good news for the shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Ampol Limited Been A Good Investment?

We think that the total shareholder return of 62%, over three years, would leave most Ampol Limited shareholders smiling. 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.

In Summary...

The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 2 warning signs for Ampol that investors should think about before committing capital to this stock.

Switching gears from Ampol, 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.

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.