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We Think Shareholders Are Less Likely To Approve A Pay Rise For Dart Mining NL's (ASX:DTM) CEO For Now

Key Insights

  • Dart Mining will host its Annual General Meeting on 30th of November

  • CEO James Chirnside's total compensation includes salary of AU$240.0k

  • Total compensation is similar to the industry average

  • Over the past three years, Dart Mining's EPS grew by 11% and over the past three years, the total loss to shareholders 90%

In the past three years, the share price of Dart Mining NL (ASX:DTM) has struggled to grow and now shareholders are sitting on a loss. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 30th of November. They could also influence management through voting on resolutions such as executive remuneration. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

View our latest analysis for Dart Mining

How Does Total Compensation For James Chirnside Compare With Other Companies In The Industry?

According to our data, Dart Mining NL has a market capitalization of AU$3.7m, and paid its CEO total annual compensation worth AU$475k over the year to June 2023. That's a notable increase of 67% on last year. In particular, the salary of AU$240.0k, makes up a fairly large portion of the total compensation being paid to the CEO.

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For comparison, other companies in the Australian Metals and Mining industry with market capitalizations below AU$305m, reported a median total CEO compensation of AU$384k. So it looks like Dart Mining compensates James Chirnside in line with the median for the industry.

Component

2023

2022

Proportion (2023)

Salary

AU$240k

AU$195k

51%

Other

AU$235k

AU$90k

49%

Total Compensation

AU$475k

AU$285k

100%

On an industry level, roughly 61% of total compensation represents salary and 39% is other remuneration. Dart Mining sets aside a smaller share of compensation for salary, in comparison to the overall 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.

ceo-compensation
ceo-compensation

A Look at Dart Mining NL's Growth Numbers

Over the past three years, Dart Mining NL has seen its earnings per share (EPS) grow by 11% per year. In the last year, its revenue is up 67%.

This demonstrates that the company has been improving recently and is good news for the shareholders. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Dart Mining NL Been A Good Investment?

Few Dart Mining NL shareholders would feel satisfied with the return of -90% over three years. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Shareholders have not seen their shares grow in value, rather they have seen their shares decline. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 3 warning signs for Dart Mining (2 are a bit unpleasant!) that you should be aware of before investing here.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.