Yahoo Finance How Much Did Archer Materials' (ASX:AXE) CEO Pocket Last Year?
Mohammad Choucair has been the CEO of Archer Materials Limited (ASX:AXE) since 2017, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Archer Materials pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
View our latest analysis for Archer Materials
Comparing Archer Materials Limited's CEO Compensation With the industry
At the time of writing, our data shows that Archer Materials Limited has a market capitalization of AU$122m, and reported total annual CEO compensation of AU$447k for the year to June 2020. That's a notable increase of 45% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at AU$175k.
For comparison, other companies in the industry with market capitalizations below AU$285m, reported a median total CEO compensation of AU$308k. Accordingly, our analysis reveals that Archer Materials Limited pays Mohammad Choucair north of the industry median. What's more, Mohammad Choucair holds AU$1.7m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2020 | 2019 | Proportion (2020) |
Salary | AU$175k | AU$175k | 39% |
Other | AU$272k | AU$134k | 61% |
Total Compensation | AU$447k | AU$309k | 100% |
Talking in terms of the industry, salary represented approximately 68% of total compensation out of all the companies we analyzed, while other remuneration made up 32% of the pie. It's interesting to note that Archer Materials allocates a smaller portion of compensation to salary in comparison 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 Archer Materials Limited's Growth Numbers
Over the last three years, Archer Materials Limited has shrunk its earnings per share by 28% per year. It achieved revenue growth of 147% over the last year.
The reduction in EPS, over three years, is arguably concerning. On the other hand, the strong revenue growth suggests the business is growing. It's hard to reach a conclusion about business performance right now. This may be one to watch. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Archer Materials Limited Been A Good Investment?
Most shareholders would probably be pleased with Archer Materials Limited for providing a total return of 779% over three years. 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...
As we touched on above, Archer Materials Limited is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. But Archer Materials is growing its revenue, and total shareholder returns have also been pleasing for the last three years. The only sore spot is EPS growth, which is negative over the same period. Although we would have liked to see EPS growth, positive shareholder returns, and growing revenues make us believe CEO compensation is reasonable.
CEO pay is simply one of the many factors that need to be considered while examining business performance. We identified 5 warning signs for Archer Materials (2 shouldn't be ignored!) that you should be aware of before investing here.
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. 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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