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How Should Investors React To Field Solutions Holdings' (ASX:FSG) CEO Pay?

Simply Wall St
·4 min read

Andrew Roberts is the CEO of Field Solutions Holdings Limited (ASX:FSG), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also assess whether Field Solutions Holdings pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Field Solutions Holdings

Comparing Field Solutions Holdings Limited's CEO Compensation With the industry

At the time of writing, our data shows that Field Solutions Holdings Limited has a market capitalization of AU$26m, and reported total annual CEO compensation of AU$347k for the year to June 2020. We note that's an increase of 10.0% above last year. In particular, the salary of AU$295.0k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the industry with market capitalizations under AU$257m, the reported median total CEO compensation was AU$335k. This suggests that Field Solutions Holdings remunerates its CEO largely in line with the industry average. Furthermore, Andrew Roberts directly owns AU$166k worth of shares in the company.

Component

2020

2019

Proportion (2020)

Salary

AU$295k

AU$295k

85%

Other

AU$52k

AU$21k

15%

Total Compensation

AU$347k

AU$316k

100%

Talking in terms of the industry, salary represented approximately 45% of total compensation out of all the companies we analyzed, while other remuneration made up 55% of the pie. It's interesting to note that Field Solutions Holdings pays out a greater portion of remuneration through salary, compared to the industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

ceo-compensation
ceo-compensation

A Look at Field Solutions Holdings Limited's Growth Numbers

Field Solutions Holdings Limited's earnings per share (EPS) grew 96% per year over the last three years. It achieved revenue growth of 21% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Field Solutions Holdings Limited Been A Good Investment?

Boasting a total shareholder return of 60% over three years, Field Solutions Holdings Limited has done well by shareholders. 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.

In Summary...

As we noted earlier, Field Solutions Holdings pays its CEO in line with similar-sized companies belonging to the same industry. Few would be critical of the leadership, since returns have been juicy and EPS are moving in the right direction. Indeed, many might consider that Andrew is compensated rather modestly, given the solid company performance! Also, such solid returns might lead to shareholders warming to the idea of a bump in pay.

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 4 warning signs for Field Solutions Holdings (of which 1 doesn't sit too well with us!) 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.