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Is Gullewa Limited (ASX:GUL) Excessively Paying Its CEO?

Simply Wall St

The CEO of Gullewa Limited (ASX:GUL) is David Deitz. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.

See our latest analysis for Gullewa

How Does David Deitz's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Gullewa Limited has a market cap of AU$6.2m, and reported total annual CEO compensation of AU$306k for the year to June 2019. We think total compensation is more important but we note that the CEO salary is lower, at AU$175k. We looked at a group of companies with market capitalizations under AU$321m, and the median CEO total compensation was AU$388k.

Next, let's break down remuneration compositions to understand how the industry and company compare with each other. On an industry level, roughly 69% of total compensation represents salary and 31% is other remuneration. Gullewa is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation

That means David Deitz receives fairly typical remuneration for the CEO of a company that size. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context. The graphic below shows how CEO compensation at Gullewa has changed from year to year.

ASX:GUL CEO Compensation April 9th 2020

Is Gullewa Limited Growing?

Gullewa Limited has seen earnings per share (EPS) move positively by an average of 92% a year, over the last three years (using a line of best fit). Its revenue is down 20% over last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. While it would be good to see revenue growth, profits matter more in the end. Although we don't have analyst forecasts you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Gullewa Limited Been A Good Investment?

Boasting a total shareholder return of 100% over three years, Gullewa Limited has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

Remuneration for David Deitz is close enough to the median pay for a CEO of a similar sized company .

The company is growing earnings per share and total shareholder returns have been pleasing. Indeed, many might consider the pay rather modest, given the solid company performance! On another note, Gullewa has 4 warning signs (and 2 which are potentially serious) we think you should know about.

If you want to buy a stock that is better than Gullewa, this free list of high return, low debt companies is a great place to look.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.