Is Beacon Lighting Group Limited (ASX:BLX) Excessively Paying Its CEO?
Glen Robinson has been the CEO of Beacon Lighting Group Limited (ASX:BLX) since 2013. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
View our latest analysis for Beacon Lighting Group
How Does Glen Robinson's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Beacon Lighting Group Limited has a market cap of AU$249m, and reported total annual CEO compensation of AU$474k for the year to June 2019. That's less than last year. We think total compensation is more important but we note that the CEO salary is lower, at AU$357k. We examined companies with market caps from AU$147m to AU$587m, and discovered that the median CEO total compensation of that group was AU$714k.
A first glance this seems like a real positive for shareholders, since Glen Robinson is paid less than the average total compensation paid by similar sized companies. While this is a good thing, you'll need to understand the business better before you can form an opinion.
You can see a visual representation of the CEO compensation at Beacon Lighting Group, below.
Is Beacon Lighting Group Limited Growing?
On average over the last three years, Beacon Lighting Group Limited has grown earnings per share (EPS) by 2.0% each year (using a line of best fit). It achieved revenue growth of 4.1% over the last year.
I would argue that the improvement in revenue isn't particularly impressive, but it is good to see modest EPS growth. So there are some positives here, but not enough to earn high praise. You might want to check this free visual report on analyst forecasts for future earnings.
Has Beacon Lighting Group Limited Been A Good Investment?
Since shareholders would have lost about 20% over three years, some Beacon Lighting Group Limited shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary...
Beacon Lighting Group Limited is currently paying its CEO below what is normal for companies of its size.
Glen Robinson receives relatively low remuneration compared to similar sized companies. But the company isn't exactly firing on all cylinders, and returns over three years are not good. I am not concerned by the CEO compensation, but it would be good to see improved performance before pay increases. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Beacon Lighting Group (free visualization of insider trades).
If you want to buy a stock that is better than Beacon Lighting Group, this free list of high return, low debt companies is a great place to look.
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