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Performance at Audio Pixels Holdings Limited (ASX:AKP) has not been particularly rosy recently and shareholders will likely be holding CEO Fred Bart and the board accountable for this. The next AGM coming up on 24 May 2021 will be a chance for shareholders to have their concerns addressed by the board, challenge management on company strategy and vote on resolutions such as executive remuneration, which may help change the company's future prospects. We think most shareholders will probably pass the CEO compensation, based on what we gathered.
How Does Total Compensation For Fred Bart Compare With Other Companies In The Industry?
At the time of writing, our data shows that Audio Pixels Holdings Limited has a market capitalization of AU$545m, and reported total annual CEO compensation of AU$67k for the year to December 2020. This was the same as last year. In particular, the salary of AU$61.0k, makes up a huge portion of the total compensation being paid to the CEO.
For comparison, other companies in the same industry with market capitalizations ranging between AU$258m and AU$1.0b had a median total CEO compensation of AU$878k. That is to say, Fred Bart is paid under the industry median. Moreover, Fred Bart also holds AU$115m worth of Audio Pixels Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
On an industry level, roughly 81% of total compensation represents salary and 19% is other remuneration. Audio Pixels Holdings is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Audio Pixels Holdings Limited's Growth
Over the last three years, Audio Pixels Holdings Limited has shrunk its earnings per share by 30% per year. In the last year, its revenue is down 21%.
The decline in EPS is a bit concerning. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Audio Pixels Holdings Limited Been A Good Investment?
Since shareholders would have lost about 4.0% over three years, some Audio Pixels Holdings Limited investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We did our research and identified 4 warning signs (and 3 which make us uncomfortable) in Audio Pixels Holdings we think you should know about.
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.
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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