We Think Some Shareholders May Hesitate To Increase Helios Energy Limited's (ASX:HE8) CEO Compensation
Key Insights
Helios Energy to hold its Annual General Meeting on 30th of November
CEO Peng He's total compensation includes salary of AU$357.7k
The overall pay is comparable to the industry average
Over the past three years, Helios Energy's EPS grew by 31% and over the past three years, the total loss to shareholders 63%
In the past three years, the share price of Helios Energy Limited (ASX:HE8) has struggled to grow and now shareholders are sitting on a loss. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 30th of November. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.
See our latest analysis for Helios Energy
Comparing Helios Energy Limited's CEO Compensation With The Industry
According to our data, Helios Energy Limited has a market capitalization of AU$164m, and paid its CEO total annual compensation worth AU$358k over the year to June 2023. That's a modest increase of 7.8% on the prior year. Notably, the salary of AU$358k is the entirety of the CEO compensation.
On comparing similar-sized companies in the Australian Oil and Gas industry with market capitalizations below AU$304m, we found that the median total CEO compensation was AU$430k. This suggests that Helios Energy remunerates its CEO largely in line with the industry average.
Component | 2023 | 2022 | Proportion (2023) |
Salary | AU$358k | AU$332k | 100% |
Other | - | - | - |
Total Compensation | AU$358k | AU$332k | 100% |
On an industry level, around 62% of total compensation represents salary and 38% is other remuneration. On a company level, Helios Energy prefers to reward its CEO through a salary, opting not to pay Peng He through non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
Helios Energy Limited's Growth
Helios Energy Limited has seen its earnings per share (EPS) increase by 31% a year over the past three years. Its revenue is up 229% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. 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 Helios Energy Limited Been A Good Investment?
With a total shareholder return of -63% over three years, Helios Energy Limited shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.
To Conclude...
Helios Energy rewards its CEO solely through a salary, ignoring non-salary benefits completely. The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.
While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 3 warning signs for Helios Energy that investors should be aware of in a dynamic business environment.
Switching gears from Helios Energy, 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.
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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.
