- Oops!Something went wrong.Please try again later.
This article will reflect on the compensation paid to Willie Labuschagne who has served as CEO of Aeris Resources Limited (ASX:AIS) since 2012. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
How Does Total Compensation For Willie Labuschagne Compare With Other Companies In The Industry?
Our data indicates that Aeris Resources Limited has a market capitalization of AU$138m, and total annual CEO compensation was reported as AU$1.1m for the year to June 2020. That is, the compensation was roughly the same as last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at AU$550k.
In comparison with other companies in the industry with market capitalizations under AU$275m, the reported median total CEO compensation was AU$314k. Accordingly, our analysis reveals that Aeris Resources Limited pays Willie Labuschagne north of the industry median. Furthermore, Willie Labuschagne directly owns AU$1.3m worth of shares in the company, implying that they are deeply invested in the company's success.
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. Aeris Resources pays a modest slice of remuneration through salary, as compared to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
Aeris Resources Limited's Growth
Aeris Resources Limited has seen its earnings per share (EPS) increase by 6.3% a year over the past three years. It saw its revenue drop 2.2% over the last year.
We would argue that the lack of revenue growth in the last year is less than ideal, but the modest improvement in EPS is good. It's hard to reach a conclusion about business performance right now. This may be one to watch. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Aeris Resources Limited Been A Good Investment?
Most shareholders would probably be pleased with Aeris Resources Limited for providing a total return of 62% 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, Willie is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Importantly though, shareholder returns for the last three years have been excellent. On the other hand, EPS growth — over the same period — is not as impressive. We'd ideally want to see higher EPS growth, but CEO compensation seems to be within reason, given high shareholder returns.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 2 warning signs for Aeris Resources (1 doesn't sit too well with us!) that you should be aware of before investing here.
Important note: Aeris Resources 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email email@example.com.