Yahoo Finance Why We Think Volt Power Group Limited's (ASX:VPR) CEO Compensation Is Not Excessive At All
CEO Adam Boyd has done a decent job of delivering relatively good performance at Volt Power Group Limited (ASX:VPR) recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 07 May 2021. Based on our analysis of the data below, we think CEO compensation seems reasonable for now.
See our latest analysis for Volt Power Group
Comparing Volt Power Group Limited's CEO Compensation With the industry
At the time of writing, our data shows that Volt Power Group Limited has a market capitalization of AU$32m, and reported total annual CEO compensation of AU$360k for the year to December 2020. That's slightly lower by 6.5% over the previous year. Notably, the salary of AU$360k is the entirety of the CEO compensation.
On comparing similar-sized companies in the industry with market capitalizations below AU$257m, we found that the median total CEO compensation was AU$360k. From this we gather that Adam Boyd is paid around the median for CEOs in the industry. Furthermore, Adam Boyd directly owns AU$4.8m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2020 | 2019 | Proportion (2020) |
Salary | AU$360k | AU$360k | 100% |
Other | - | AU$25k | - |
Total Compensation | AU$360k | AU$385k | 100% |
On an industry level, around 83% of total compensation represents salary and 17% is other remuneration. Speaking on a company level, Volt Power Group prefers to tread along a traditional path, disbursing all compensation through a salary. 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.
Volt Power Group Limited's Growth
Over the last three years, Volt Power Group Limited has shrunk its earnings per share by 36% per year. In the last year, its revenue is up 65%.
The decrease in EPS could be a concern for some investors. But in contrast the revenue growth is strong, suggesting future potential for EPS growth. 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. 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 Volt Power Group Limited Been A Good Investment?
Boasting a total shareholder return of 50% over three years, Volt Power Group 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...
Volt Power Group rewards its CEO solely through a salary, ignoring non-salary benefits completely. Some shareholders will be pleased by the relatively good results, however, the results could still be improved. We reckon that there are some shareholders who may be hesitant to increase CEO pay further until EPS growth starts to improve, despite the robust revenue growth.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 4 warning signs for Volt Power Group (1 is a bit unpleasant!) that you should be aware of before investing here.
Switching gears from Volt Power 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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