This article will reflect on the compensation paid to Demetrios Pynes who has served as CEO of Threat Protect Australia Limited (ASX:TPS) since 2015. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Threat Protect Australia.
Comparing Threat Protect Australia Limited's CEO Compensation With the industry
According to our data, Threat Protect Australia Limited has a market capitalization of AU$14m, and paid its CEO total annual compensation worth AU$302k over the year to June 2020. That's a fairly small increase of 7.7% over the previous year. We note that the salary portion, which stands at AU$262.4k constitutes the majority of total compensation received by the CEO.
For comparison, other companies in the industry with market capitalizations below AU$285m, reported a median total CEO compensation of AU$404k. This suggests that Threat Protect Australia remunerates its CEO largely in line with the industry average. Moreover, Demetrios Pynes also holds AU$287k worth of Threat Protect Australia stock directly under their own name.
On an industry level, roughly 64% of total compensation represents salary and 36% is other remuneration. It's interesting to note that Threat Protect Australia pays out a greater portion of remuneration through salary, compared to the industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Threat Protect Australia Limited's Growth
Over the last three years, Threat Protect Australia Limited has shrunk its earnings per share by 93% per year. In the last year, its revenue is up 40%.
The decrease in EPS could be a concern for some investors. But on the other hand, revenue growth is strong, suggesting a brighter future. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Threat Protect Australia Limited Been A Good Investment?
Given the total shareholder loss of 75% over three years, many shareholders in Threat Protect Australia Limited are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be lessto generous with CEO compensation.
As previously discussed, Demetrios is compensated close to the median for companies of its size, and which belong to the same industry. Still, the company is logging healthy revenue growth over the last year. On the other hand, shareholder returns for Demetrios are negative over the same period. EPS growth is bleak as well, adding fuel to the fire. Overall, we wouldn't say CEO is highly paid, but shareholders might not go for a raise before business metrics start to improve precipitously.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 5 warning signs for Threat Protect Australia (of which 3 are significant!) that you should know about in order to have a holistic understanding of the stock.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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. 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.
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