Yahoo Finance Most Shareholders Will Probably Agree With Flight Centre Travel Group Limited's (ASX:FLT) CEO Compensation
Performance at Flight Centre Travel Group Limited (ASX:FLT) has been rather uninspiring recently and shareholders may be wondering how CEO Skroo Turner plans to fix this. They will get a chance to exercise their voting power to influence the future direction of the company in the next AGM on 14 November 2022. Voting on executive pay could be a powerful way to influence management, as studies have shown that the right compensation incentives impact company performance. We think CEO compensation looks appropriate given the data we have put together.
See our latest analysis for Flight Centre Travel Group
Comparing Flight Centre Travel Group Limited's CEO Compensation With The Industry
Our data indicates that Flight Centre Travel Group Limited has a market capitalization of AU$3.4b, and total annual CEO compensation was reported as AU$733k for the year to June 2022. We note that's an increase of 13% above last year. In particular, the salary of AU$651.4k, makes up a huge portion of the total compensation being paid to the CEO.
On examining similar-sized companies in the industry with market capitalizations between AU$1.6b and AU$5.0b, we discovered that the median CEO total compensation of that group was AU$1.6m. In other words, Flight Centre Travel Group pays its CEO lower than the industry median. Moreover, Skroo Turner also holds AU$305m worth of Flight Centre Travel Group 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$651k | AU$625k | 89% |
Other | AU$81k | AU$26k | 11% |
Total Compensation | AU$733k | AU$651k | 100% |
On an industry level, around 54% of total compensation represents salary and 46% is other remuneration. Flight Centre Travel Group is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.
Flight Centre Travel Group Limited's Growth
Over the last three years, Flight Centre Travel Group Limited has shrunk its earnings per share by 45% per year. Its revenue is up 147% over the last year.
Investors would be a bit wary of companies that have lower EPS On the other hand, the strong revenue growth suggests the business is growing. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Flight Centre Travel Group Limited Been A Good Investment?
The return of -53% over three years would not have pleased Flight Centre Travel Group Limited shareholders. So shareholders would probably want the company to be less generous with CEO compensation.
To Conclude...
The fact that shareholders have earned a negative share price return is certainly disconcerting. The poor performance of the share price might have something to do with the lack of earnings growth. The upcoming AGM will provide shareholders the opportunity to raise their concerns and evaluate if the board’s judgement and decision-making is aligned with their expectations.
Shareholders may want to check for free if Flight Centre Travel Group insiders are buying or selling shares.
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.
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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