The CEO of TPC Consolidated Limited (ASX:TPC) is Charles Huang, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for TPC Consolidated.
Comparing TPC Consolidated Limited's CEO Compensation With the industry
According to our data, TPC Consolidated Limited has a market capitalization of AU$15m, and paid its CEO total annual compensation worth AU$415k over the year to June 2020. Notably, that's an increase of 23% over the year before. Notably, the salary which is AU$317.2k, represents most of the total compensation being paid.
In comparison with other companies in the industry with market capitalizations under AU$264m, the reported median total CEO compensation was AU$417k. So it looks like TPC Consolidated compensates Charles Huang in line with the median for the industry. Furthermore, Charles Huang directly owns AU$5.5m worth of shares in the company, implying that they are deeply invested in the company's success.
On an industry level, roughly 24% of total compensation represents salary and 76% is other remuneration. According to our research, TPC Consolidated has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
A Look at TPC Consolidated Limited's Growth Numbers
TPC Consolidated Limited's earnings per share (EPS) grew 59% per year over the last three years. Its revenue is up 3.6% over the last year.
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. 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 TPC Consolidated Limited Been A Good Investment?
TPC Consolidated Limited has not done too badly by shareholders, with a total return of 9.3%, over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
As previously discussed, Charles is compensated close to the median for companies of its size, and which belong to the same industry. But EPS growth for the company has been strong over the last three years, though shareholder returns in comparison haven't been as impressive. Considering overall performance, we'd say the compensation is fair, although stockholders will want to see higher returns moving forward.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 1 warning sign for TPC Consolidated that investors should look into moving forward.
Important note: TPC Consolidated 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.
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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