Should You Worry About DGR Global Limited's (ASX:DGR) CEO Pay?
Nick Mather is the CEO of DGR Global Limited (ASX:DGR). First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
See our latest analysis for DGR Global
How Does Nick Mather's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that DGR Global Limited has a market cap of AU$46m, and reported total annual CEO compensation of AU$314k for the year to June 2019. It is worth noting that the CEO compensation consists almost entirely of the salary, worth AU$300k. We looked at a group of companies with market capitalizations under AU$309m, and the median CEO total compensation was AU$385k.
Now let's take a look at the pay mix on an industry and company level to gain a better understanding of where DGR Global stands. Talking in terms of the sector, salary represented approximately 69% of total compensation out of all the companies we analysed, while other remuneration made up 31% of the pie. DGR Global has gone down a largely traditional route, paying Nick Mather a high salary, giving it preference as a compensation method to non-salary benefits.
That means Nick Mather receives fairly typical remuneration for the CEO of a company that size. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance. The graphic below shows how CEO compensation at DGR Global has changed from year to year.
Is DGR Global Limited Growing?
DGR Global Limited has reduced its earnings per share by an average of 114% a year, over the last three years (measured with a line of best fit). The trailing twelve months of revenue was pretty much the same as the prior period.
Few shareholders would be pleased to read that earnings per share are lower over three years. And the flat revenue is seriously uninspiring. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has DGR Global Limited Been A Good Investment?
Given the total loss of 44% over three years, many shareholders in DGR Global Limited are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
Nick Mather is paid around what is normal for the leaders of comparable size companies.
After looking at EPS and total shareholder returns, it's certainly hard to argue the company has performed well, since both metrics are down. Suffice it to say, we don't think the CEO is underpaid! Shifting gears from CEO pay for a second, we've spotted 6 warning signs for DGR Global you should be aware of, and 2 of them are a bit concerning.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.
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