Shareholders May Not Be So Generous With OncoSil Medical Limited's (ASX:OSL) CEO Compensation And Here's Why
Key Insights
OncoSil Medical's Annual General Meeting to take place on 28th of November
CEO Nigel Lange's total compensation includes salary of AU$388.3k
The overall pay is comparable to the industry average
Over the past three years, OncoSil Medical's EPS fell by 13% and over the past three years, the total loss to shareholders 94%
In the past three years, the share price of OncoSil Medical Limited (ASX:OSL) has struggled to grow and now shareholders are sitting on a loss. In addition, the company's per-share earnings growth is not looking good, despite growing revenues. In light of this performance, shareholders will have a chance to question the board in the upcoming AGM on 28th of November, where they can impact on future company performance by voting on resolutions, including executive compensation. Here's our take on why we think shareholders might be hesitant about approving a raise at the moment.
Check out our latest analysis for OncoSil Medical
How Does Total Compensation For Nigel Lange Compare With Other Companies In The Industry?
Our data indicates that OncoSil Medical Limited has a market capitalization of AU$16m, and total annual CEO compensation was reported as AU$639k for the year to June 2023. That's a fairly small increase of 4.9% over the previous year. In particular, the salary of AU$388.3k, makes up a huge portion of the total compensation being paid to the CEO.
In comparison with other companies in the Australia Life Sciences industry with market capitalizations under AU$305m, the reported median total CEO compensation was AU$588k. This suggests that OncoSil Medical remunerates its CEO largely in line with the industry average.
Component | 2023 | 2022 | Proportion (2023) |
Salary | AU$388k | AU$388k | 61% |
Other | AU$250k | AU$220k | 39% |
Total Compensation | AU$639k | AU$608k | 100% |
Speaking on an industry level, nearly 79% of total compensation represents salary, while the remainder of 21% is other remuneration. OncoSil Medical sets aside a smaller share of compensation for salary, in comparison to the overall 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.
OncoSil Medical Limited's Growth
Over the last three years, OncoSil Medical Limited has shrunk its earnings per share by 13% per year. It achieved revenue growth of 38% over the last year.
The reduction in EPS, over three years, is arguably concerning. But in contrast the revenue growth is strong, suggesting future potential for EPS growth. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. 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 OncoSil Medical Limited Been A Good Investment?
Few OncoSil Medical Limited shareholders would feel satisfied with the return of -94% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
To Conclude...
The returns to shareholders is disappointing along with lack of earnings growth, which goes some way in explaining the poor returns. Shareholders will get the chance at the upcoming AGM to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 6 warning signs for OncoSil Medical (5 are a bit unpleasant!) that you should be aware of before investing here.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.
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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.
