Yahoo Finance We Take A Look At Why Strandline Resources Limited's (ASX:STA) CEO Compensation Is Well Earned
We have been pretty impressed with the performance at Strandline Resources Limited (ASX:STA) recently and CEO Luke Graham deserves a mention for their role in it. Shareholders will have this at the front of their minds in the upcoming AGM on 24 November 2022. It is likely that the focus will be on company strategy going forward as shareholders hear from the board and cast their votes on resolutions such as executive remuneration and other matters. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.
View our latest analysis for Strandline Resources
Comparing Strandline Resources Limited's CEO Compensation With The Industry
At the time of writing, our data shows that Strandline Resources Limited has a market capitalization of AU$594m, and reported total annual CEO compensation of AU$1.0m for the year to June 2022. We note that's an increase of 21% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at AU$475k.
In comparison with other companies in the industry with market capitalizations ranging from AU$301m to AU$1.2b, the reported median CEO total compensation was AU$1.1m. So it looks like Strandline Resources compensates Luke Graham in line with the median for the industry. Moreover, Luke Graham also holds AU$6.2m worth of Strandline Resources stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2022 | 2021 | Proportion (2022) |
Salary | AU$475k | AU$385k | 47% |
Other | AU$528k | AU$445k | 53% |
Total Compensation | AU$1.0m | AU$831k | 100% |
On an industry level, around 60% of total compensation represents salary and 40% is other remuneration. Strandline Resources pays a modest slice of remuneration through salary, as compared to the broader industry. 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 Strandline Resources Limited's Growth Numbers
Strandline Resources Limited has seen its earnings per share (EPS) increase by 26% a year over the past three years. In the last year, its revenue is down 45%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end. 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 Strandline Resources Limited Been A Good Investment?
Boasting a total shareholder return of 371% over three years, Strandline Resources Limited has done well by shareholders. 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 company performance has been quite good recently, some shareholders may feel that CEO compensation may not be the biggest focus in the upcoming AGM. 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 is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 3 warning signs for Strandline Resources (of which 1 is a bit unpleasant!) that you should know about in order to have a holistic understanding of the stock.
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.
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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