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How Is K2fly's (ASX:K2F) CEO Paid Relative To Peers?

Simply Wall St

This article will reflect on the compensation paid to Brian Miller who has served as CEO of K2fly Limited (ASX:K2F) since 2016. This analysis will also assess whether K2fly pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

Check out our latest analysis for K2fly

How Does Total Compensation For Brian Miller Compare With Other Companies In The Industry?

At the time of writing, our data shows that K2fly Limited has a market capitalization of AU$33m, and reported total annual CEO compensation of AU$357k for the year to June 2020. That's a notable increase of 11% on last year. In particular, the salary of AU$252.0k, 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$272m, the reported median total CEO compensation was AU$347k. So it looks like K2fly compensates Brian Miller in line with the median for the industry. Furthermore, Brian Miller directly owns AU$992k worth of shares in the company, implying that they are deeply invested in the company's success.

Component

2020

2019

Proportion (2020)

Salary

AU$252k

AU$252k

71%

Other

AU$105k

AU$71k

29%

Total Compensation

AU$357k

AU$323k

100%

On an industry level, around 62% of total compensation represents salary and 38% is other remuneration. According to our research, K2fly 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.

ceo-compensation
ceo-compensation

K2fly Limited's Growth

K2fly Limited has seen its earnings per share (EPS) increase by 27% a year over the past three years. It achieved revenue growth of 48% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. 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 K2fly Limited Been A Good Investment?

Boasting a total shareholder return of 350% over three years, K2fly 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.

To Conclude...

As we noted earlier, K2fly pays its CEO in line with similar-sized companies belonging to the same industry. Investors would surely be happy to see that returns have been great, and that EPS is up. So one could argue that CEO compensation is quite modest, if you consider company performance! Also, such solid returns might lead to shareholders warming to the idea of a bump in pay.

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 5 warning signs for K2fly (1 is significant!) that you should be aware of before investing here.

Switching gears from K2fly, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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@simplywallst.com.