Yahoo Finance What Can We Make Of Nanollose's (ASX:NC6) CEO Compensation?
Alfie Germano is the CEO of Nanollose Limited (ASX:NC6), and in this article, we analyze the executive's compensation package 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 Nanollose.
View our latest analysis for Nanollose
How Does Total Compensation For Alfie Germano Compare With Other Companies In The Industry?
At the time of writing, our data shows that Nanollose Limited has a market capitalization of AU$9.5m, and reported total annual CEO compensation of AU$326k for the year to June 2020. Notably, that's an increase of 8.8% over the year before. In particular, the salary of AU$172.5k, makes up a huge portion of the total compensation being paid to the CEO.
On comparing similar-sized companies in the industry with market capitalizations below AU$279m, we found that the median total CEO compensation was AU$443k. This suggests that Nanollose remunerates its CEO largely in line with the industry average.
Component | 2020 | 2019 | Proportion (2020) |
Salary | AU$173k | AU$239k | 53% |
Other | AU$154k | AU$61k | 47% |
Total Compensation | AU$326k | AU$300k | 100% |
Talking in terms of the industry, salary represented approximately 65% of total compensation out of all the companies we analyzed, while other remuneration made up 35% of the pie. In Nanollose's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader 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.
Nanollose Limited's Growth
Nanollose Limited's earnings per share (EPS) grew 2.8% per year over the last three years. In the last year, its revenue is up 94%.
We like the look of the strong year-on-year improvement in revenue. With that in mind, the modestly improving EPS seems positive. We'd stop short of saying the business performance is amazing, but there are enough positives to justify further research, or even adding the stock to your watch-list. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Nanollose Limited Been A Good Investment?
With a three year total loss of 63% for the shareholders, Nanollose Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
As previously discussed, Alfie is compensated close to the median for companies of its size, and which belong to the same industry. Meanwhile, Nanollose is suffering from adverse shareholder returns and althoughEPS have grown over the past three years, they have not been extraordinary. CEO pay isn't exceptionally high, but considering poor performance, shareholders will likely hold off support for a raise until results improve.
CEO pay is simply one of the many factors that need to be considered while examining business performance. That's why we did our research, and identified 5 warning signs for Nanollose (of which 4 can't be ignored!) that you should know about in order to have a holistic understanding of the stock.
Important note: Nanollose is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.
