Yahoo Finance We Think Aspermont Limited's (ASX:ASP) CEO Compensation Looks Fair
It would be hard to discount the role that CEO Alex Kent has played in delivering the impressive results at Aspermont Limited (ASX:ASP) recently. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 28 February 2022. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. Here is our take on why we think CEO compensation is not extravagant.
See our latest analysis for Aspermont
How Does Total Compensation For Alex Kent Compare With Other Companies In The Industry?
Our data indicates that Aspermont Limited has a market capitalization of AU$56m, and total annual CEO compensation was reported as AU$720k for the year to September 2021. That's just a smallish increase of 3.9% on last year. In particular, the salary of AU$360.5k, makes up a fairly large portion of the total compensation being paid to the CEO.
In comparison with other companies in the industry with market capitalizations under AU$279m, the reported median total CEO compensation was AU$720k. So it looks like Aspermont compensates Alex Kent in line with the median for the industry. What's more, Alex Kent holds AU$121k worth of shares in the company in their own name.
Component | 2021 | 2020 | Proportion (2021) |
Salary | AU$360k | AU$372k | 50% |
Other | AU$360k | AU$321k | 50% |
Total Compensation | AU$720k | AU$693k | 100% |
Speaking on an industry level, nearly 55% of total compensation represents salary, while the remainder of 45% is other remuneration. There isn't a significant difference between Aspermont and the broader market, in terms of salary allocation in the overall compensation package. 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.
A Look at Aspermont Limited's Growth Numbers
Aspermont Limited has seen its earnings per share (EPS) increase by 70% a year over the past three years. In the last year, its revenue is up 5.6%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. 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 Aspermont Limited Been A Good Investment?
Boasting a total shareholder return of 167% over three years, Aspermont Limited has done well by shareholders. 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...
Given the improved performance, shareholders may be more forgiving of CEO compensation in the upcoming AGM. In saying that, some shareholders may feel that the more important issues to be addressed may be how the management plans to steer the company towards sustainable profitability in the future.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 3 warning signs for Aspermont that investors should be aware of in a dynamic business environment.
Important note: Aspermont 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.
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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.
