Yahoo Finance Why Huon Aquaculture Group's (ASX:HUO) CEO Pay Matters
Peter Bender is the CEO of Huon Aquaculture Group Limited (ASX:HUO), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
View our latest analysis for Huon Aquaculture Group
How Does Total Compensation For Peter Bender Compare With Other Companies In The Industry?
According to our data, Huon Aquaculture Group Limited has a market capitalization of AU$300m, and paid its CEO total annual compensation worth AU$700k over the year to June 2020. Notably, that's a decrease of 24% over the year before. We note that the salary portion, which stands at AU$568.1k constitutes the majority of total compensation received by the CEO.
On examining similar-sized companies in the industry with market capitalizations between AU$134m and AU$537m, we discovered that the median CEO total compensation of that group was AU$699k. This suggests that Huon Aquaculture Group remunerates its CEO largely in line with the industry average. Furthermore, Peter Bender directly owns AU$36m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2020 | 2019 | Proportion (2020) |
Salary | AU$568k | AU$532k | 81% |
Other | AU$132k | AU$389k | 19% |
Total Compensation | AU$700k | AU$921k | 100% |
On an industry level, roughly 80% of total compensation represents salary and 20% is other remuneration. Although there is a difference in how total compensation is set, Huon Aquaculture Group more or less reflects the market in terms of setting the salary. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Huon Aquaculture Group Limited's Growth
Huon Aquaculture Group Limited has reduced its earnings per share by 51% a year over the last three years. In the last year, its revenue is up 20%.
The reduction in EPS, over three years, is arguably concerning. On the other hand, the strong revenue growth suggests the business is growing. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Huon Aquaculture Group Limited Been A Good Investment?
With a three year total loss of 35% for the shareholders, Huon Aquaculture Group Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
As previously discussed, Peter is compensated close to the median for companies of its size, and which belong to the same industry. However, revenues have increased over the past year, a positive sign for the company. On the other hand, shareholder returns for Peter are negative over the same period. EPS growth is also negative, adding insult to injury. Overall, we wouldn't say CEO is highly paid, but shareholders might not go for a raise before business metrics start to improve precipitously.
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 Huon Aquaculture Group (1 is potentially serious!) that you should be aware of before investing here.
Switching gears from Huon Aquaculture Group, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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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