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Darren Gordon became the CEO of Centaurus Metals Limited (ASX:CTM) in 2009, and we think it's a good time to look at 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 Centaurus Metals.
How Does Total Compensation For Darren Gordon Compare With Other Companies In The Industry?
At the time of writing, our data shows that Centaurus Metals Limited has a market capitalization of AU$209m, and reported total annual CEO compensation of AU$410k for the year to December 2019. That's a slightly lower by 5.3% over the previous year. Notably, the salary which is AU$334.3k, represents most of the total compensation being paid.
For comparison, other companies in the same industry with market capitalizations ranging between AU$138m and AU$553m had a median total CEO compensation of AU$650k. That is to say, Darren Gordon is paid under the industry median. Moreover, Darren Gordon also holds AU$3.7m worth of Centaurus Metals stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Talking in terms of the industry, salary represented approximately 70% of total compensation out of all the companies we analyzed, while other remuneration made up 30% of the pie. According to our research, Centaurus Metals has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
A Look at Centaurus Metals Limited's Growth Numbers
Centaurus Metals Limited has seen its earnings per share (EPS) increase by 21% a year over the past three years. It achieved revenue growth of 427% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Centaurus Metals Limited Been A Good Investment?
Most shareholders would probably be pleased with Centaurus Metals Limited for providing a total return of 848% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
As previously discussed, Darren is compensated less than what is normal for CEOs of companies of similar size, and which belong to the same industry. Since EPS growth is heading in a positive direction; many would agree with our assessment that the pay is modest. And given most shareholders are probably very happy with recent shareholder returns, they might even think Darren deserves a raise!
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 5 warning signs for Centaurus Metals (of which 3 are significant!) that you should know about in order to have a holistic understanding of the stock.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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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