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Is Indoor Skydive Australia Group Limited's (ASX:IDZ) CEO Being Overpaid?

Simply Wall St

Wayne Jones is the CEO of Indoor Skydive Australia Group Limited (ASX:IDZ). First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.

See our latest analysis for Indoor Skydive Australia Group

How Does Wayne Jones's Compensation Compare With Similar Sized Companies?

Our data indicates that Indoor Skydive Australia Group Limited is worth AU$3.4m, and total annual CEO compensation was reported as AU$253k for the year to June 2019. That's below the compensation, last year. While we always look at total compensation first, we note that the salary component is less, at AU$219k. We took a group of companies with market capitalizations below AU$292m, and calculated the median CEO total compensation to be AU$378k.

A first glance this seems like a real positive for shareholders, since Wayne Jones is paid less than the average total compensation paid by similar sized companies. While this is a good thing, you'll need to understand the business better before you can form an opinion.

The graphic below shows how CEO compensation at Indoor Skydive Australia Group has changed from year to year.

ASX:IDZ CEO Compensation, November 11th 2019

Is Indoor Skydive Australia Group Limited Growing?

Indoor Skydive Australia Group Limited has reduced its earnings per share by an average of 55% a year, over the last three years (measured with a line of best fit). It saw its revenue drop 15% over the last year.

Sadly for shareholders, earnings per share are actually down, over three years. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Indoor Skydive Australia Group Limited Been A Good Investment?

Since shareholders would have lost about 98% over three years, some Indoor Skydive Australia Group Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

It looks like Indoor Skydive Australia Group Limited pays its CEO less than similar sized companies.

The compensation paid to Wayne Jones is lower than is usual at similar sized companies, but the eps growth is lacking, just like the returns (over three years). Considering all these factors, we'd stop short of saying the CEO pay is too high, but we don't think shareholders would want to see a pay rise before business performance improves. Shareholders may want to check for free if Indoor Skydive Australia Group insiders are buying or selling shares.

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

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.

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. Thank you for reading.