Yahoo Finance How Much Is Lefroy Exploration Limited (ASX:LEX) Paying Its CEO?
Wade Johnson has been the CEO of Lefroy Exploration Limited (ASX:LEX) since 2016, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Lefroy Exploration.
See our latest analysis for Lefroy Exploration
How Does Total Compensation For Wade Johnson Compare With Other Companies In The Industry?
Our data indicates that Lefroy Exploration Limited has a market capitalization of AU$24m, and total annual CEO compensation was reported as AU$283k for the year to June 2020. We note that's a decrease of 11% compared to last year. Notably, the salary which is AU$220.0k, represents most of the total compensation being paid.
For comparison, other companies in the industry with market capitalizations below AU$259m, reported a median total CEO compensation of AU$305k. So it looks like Lefroy Exploration compensates Wade Johnson in line with the median for the industry. Moreover, Wade Johnson also holds AU$841k worth of Lefroy Exploration stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2020 | 2019 | Proportion (2020) |
Salary | AU$220k | AU$220k | 78% |
Other | AU$63k | AU$99k | 22% |
Total Compensation | AU$283k | AU$319k | 100% |
On an industry level, around 69% of total compensation represents salary and 31% is other remuneration. It's interesting to note that Lefroy Exploration pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
Lefroy Exploration Limited's Growth
Over the last three years, Lefroy Exploration Limited has shrunk its earnings per share by 21% per year. Its revenue is up 284% over the last year.
The decrease in EPS could be a concern for some investors. But in contrast the revenue growth is strong, suggesting future potential for EPS growth. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. 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 Lefroy Exploration Limited Been A Good Investment?
Most shareholders would probably be pleased with Lefroy Exploration Limited for providing a total return of 38% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
To Conclude...
As we noted earlier, Lefroy Exploration pays its CEO in line with similar-sized companies belonging to the same industry. The company has logged solid shareholder returns for the past three years. At the same time, revenues are also moving northwards at a healthy pace. On a worrying note, its important to acknowledge that EPS growth has been negative recently. However, considering overall positive performance, we think Wade, shareholders might not be too worried about the CEO's compensation.
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 6 warning signs for Lefroy Exploration (of which 3 are a bit unpleasant!) that you should know about in order to have a holistic understanding of the stock.
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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