What Did XTEK's (ASX:XTE) CEO Take Home Last Year?

This article will reflect on the compensation paid to Philippe Odouard who has served as CEO of XTEK Limited (ASX:XTE) since 2016. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for XTEK.

Check out our latest analysis for XTEK

How Does Total Compensation For Philippe Odouard Compare With Other Companies In The Industry?

At the time of writing, our data shows that XTEK Limited has a market capitalization of AU$40m, and reported total annual CEO compensation of AU$654k for the year to June 2020. Notably, that's an increase of 52% over the year before. Notably, the salary which is AU$355.7k, represents most of the total compensation being paid.

For comparison, other companies in the industry with market capitalizations below AU$265m, reported a median total CEO compensation of AU$638k. So it looks like XTEK compensates Philippe Odouard in line with the median for the industry. What's more, Philippe Odouard holds AU$481k worth of shares in the company in their own name.

On an industry level, roughly 53% of total compensation represents salary and 47% is other remuneration. There isn't a significant difference between XTEK and the broader market, in terms of salary allocation in the overall compensation package. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at XTEK Limited's Growth Numbers

XTEK Limited's earnings per share (EPS) grew 40% per year over the last three years. In the last year, its revenue is up 13%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has XTEK Limited Been A Good Investment?

XTEK Limited has not done too badly by shareholders, with a total return of 0.9%, over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

As previously discussed, Philippe is compensated close to the median for companies of its size, and which belong to the same industry. But EPS growth over the last three years has been impressive, although the same cannot be said for shareholder returns. Considering overall performance, we'd say the compensation is fair, although stockholders will want to see higher returns moving forward.

CEO pay is simply one of the many factors that need to be considered while examining business performance. That's why we did our research, and identified 3 warning signs for XTEK (of which 1 is concerning!) that you should know about in order to have a holistic understanding of the stock.

Important note: XTEK is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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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