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Key Things To Understand About Bio-Gene Technology's (ASX:BGT) CEO Pay Cheque

Richard Jagger has been the CEO of Bio-Gene Technology Limited (ASX:BGT) since 2018, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Bio-Gene Technology pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

Check out our latest analysis for Bio-Gene Technology

Comparing Bio-Gene Technology Limited's CEO Compensation With the industry

According to our data, Bio-Gene Technology Limited has a market capitalization of AU$21m, and paid its CEO total annual compensation worth AU$466k over the year to June 2020. We note that's an increase of 36% above last year. We note that the salary portion, which stands at AU$239.2k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under AU$272m, the reported median total CEO compensation was AU$348k. Hence, we can conclude that Richard Jagger is remunerated higher than the industry median. Moreover, Richard Jagger also holds AU$755k worth of Bio-Gene Technology stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component

2020

2019

Proportion (2020)

Salary

AU$239k

AU$246k

51%

Other

AU$227k

AU$97k

49%

Total Compensation

AU$466k

AU$343k

100%

On an industry level, roughly 69% of total compensation represents salary and 31% is other remuneration. It's interesting to note that Bio-Gene Technology allocates a smaller portion of compensation to salary in comparison to the broader 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

A Look at Bio-Gene Technology Limited's Growth Numbers

Earnings per share at Bio-Gene Technology Limited are much the same as they were three years ago, albeit with slightly higher. It achieved revenue growth of 907% over the last year.

It's hard to interpret the strong revenue growth as anything other than a positive. And in that context, the modest EPS improvement certainly isn't shabby. We'd stop short of saying the business performance is amazing, but there are enough positives to justify further research, or even adding the stock to your watch-list. 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 Bio-Gene Technology Limited Been A Good Investment?

With a three year total loss of 30% for the shareholders, Bio-Gene Technology Limited would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.

In Summary...

As previously discussed, Richard is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. While we have not been overly impressed by the business performance, the shareholder returns have been utterly depressing, over the last three years. This doesn't look good when you see that Richard is earning more than the industry median. Taking all this into account, it could be hard to get shareholder support for giving Richard a raise.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 5 warning signs for Bio-Gene Technology (2 are significant!) 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.

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.

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