Why Zenith Minerals Limited's (ASX:ZNC) CEO Pay Matters To You
Mick Clifford became the CEO of Zenith Minerals Limited (ASX:ZNC) in 2014. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
Check out our latest analysis for Zenith Minerals
How Does Mick Clifford's Compensation Compare With Similar Sized Companies?
Our data indicates that Zenith Minerals Limited is worth AU$13m, and total annual CEO compensation was reported as AU$296k for the year to June 2019. We note that's an increase of 27% above last year. We think total compensation is more important but we note that the CEO salary is lower, at AU$233k. We examined a group of similar sized companies, with market capitalizations of below AU$290m. The median CEO total compensation in that group is AU$380k.
So Mick Clifford receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
The graphic below shows how CEO compensation at Zenith Minerals has changed from year to year.
Is Zenith Minerals Limited Growing?
Over the last three years Zenith Minerals Limited has grown its earnings per share (EPS) by an average of 34% per year (using a line of best fit). It achieved revenue growth of 185% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Although we don't have analyst forecasts you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Zenith Minerals Limited Been A Good Investment?
Since shareholders would have lost about 44% over three years, some Zenith Minerals Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
In Summary...
Mick Clifford is paid around the same as most CEOs of similar size companies.
We like that the company is growing EPS, but it's disappointing to see negative shareholder returns over three years. Considering the the positives we don't think the CEO pays is too high, but it's certainly hard to argue it is too low. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Zenith Minerals.
Important note: Zenith Minerals may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
