Here's Why Xtract One Technologies Inc.'s (TSE:XTRA) CEO Compensation Is The Least Of Shareholders' Concerns
Key Insights
Xtract One Technologies' Annual General Meeting to take place on 14th of November
CEO Peter Evans' total compensation includes salary of CA$511.7k
The overall pay is comparable to the industry average
Xtract One Technologies' total shareholder return over the past three years was 15% while its EPS was down 21% over the past three years
Despite positive share price growth of 15% for Xtract One Technologies Inc. (TSE:XTRA) over the last few years, earnings growth has been disappointing, which suggests something is amiss. Some of these issues will occupy shareholders' minds as the AGM rolls around on 14th of November. One way that shareholders can influence managerial decisions is through voting on CEO and executive remuneration packages, which studies show could impact company performance. From the data that we gathered, we think that shareholders should hold off on a raise on CEO compensation until performance starts to show some improvement.
See our latest analysis for Xtract One Technologies
Comparing Xtract One Technologies Inc.'s CEO Compensation With The Industry
According to our data, Xtract One Technologies Inc. has a market capitalization of CA$143m, and paid its CEO total annual compensation worth CA$763k over the year to July 2023. That's just a smallish increase of 7.5% on last year. We note that the salary portion, which stands at CA$511.7k constitutes the majority of total compensation received by the CEO.
In comparison with other companies in the Canadian Aerospace & Defense industry with market capitalizations under CA$275m, the reported median total CEO compensation was CA$763k. So it looks like Xtract One Technologies compensates Peter Evans in line with the median for the industry. Furthermore, Peter Evans directly owns CA$286k worth of shares in the company.
Component | 2023 | 2022 | Proportion (2023) |
Salary | CA$512k | CA$273k | 67% |
Other | CA$251k | CA$436k | 33% |
Total Compensation | CA$763k | CA$709k | 100% |
On an industry level, around 51% of total compensation represents salary and 49% is other remuneration. According to our research, Xtract One Technologies has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.
Xtract One Technologies Inc.'s Growth
Over the last three years, Xtract One Technologies Inc. has shrunk its earnings per share by 21% per year. Its revenue is up 14% over the last year.
The decline in EPS is a bit concerning. While the revenue growth is good to see, it is outweighed by the fact that EPS are down, over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Xtract One Technologies Inc. Been A Good Investment?
With a total shareholder return of 15% over three years, Xtract One Technologies Inc. shareholders would, in general, be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
To Conclude...
While it's true that shareholders have owned decent returns, it's hard to overlook the lack of earnings growth and this makes us question whether these returns will continue. The upcoming AGM will provide shareholders the opportunity to revisit the company’s remuneration policies and evaluate if the board’s judgement and decision-making is aligned with that of the company’s shareholders.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 4 warning signs for Xtract One Technologies (2 are a bit concerning!) that you should be aware of before investing here.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.
