In 2003 Tony Rovira was appointed CEO of Azure Minerals Limited (ASX:AZS). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. 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.
How Does Tony Rovira’s Compensation Compare With Similar Sized Companies?
According to our data, Azure Minerals Limited has a market capitalization of AU$12m, and pays its CEO total annual compensation worth AU$641k. (This number is for the twelve months until June 2018). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at AU$358k. We looked at a group of companies with market capitalizations under AU$282m, and the median CEO total compensation was AU$354k.
It would therefore appear that Azure Minerals Limited pays Tony Rovira more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at Azure Minerals has changed from year to year.
Is Azure Minerals Limited Growing?
Earnings per share at Azure Minerals Limited are much the same as they were three years ago, albeit slightly lower, based on the trend. Its revenue is down -70% over last year.
Unfortunately there is a complete lack of earnings per share improvement, over three years. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO. Although we don’t have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Azure Minerals Limited Been A Good Investment?
Since shareholders would have lost about 86% over three years, some Azure Minerals Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.
We compared the total CEO remuneration paid by Azure Minerals Limited, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
We think many shareholders would be underwhelmed with the business growth over the last three years.
Over the same period, investors would have come away with nothing in the way of share price gains. This analysis suggests to us that the CEO is paid too generously! Whatever your view on compensation, you might want to check if insiders are buying or selling Azure Minerals shares (free trial).
If you want to buy a stock that is better than Azure Minerals, this free list of high return, low debt companies is a great place to look.
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If you spot an error that warrants correction, please contact the editor at email@example.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. Thank you for reading.