Associate Global Partners Limited's (ASX:APL) CEO Might Not Expect Shareholders To Be So Generous This Year

Key Insights

• Associate Global Partners will host its Annual General Meeting on 13th of November
• Salary of AU$470.0k is part of CEO Marty Switzer's total remuneration
• The total compensation is 30% higher than the average for the industry
• Over the past three years, Associate Global Partners' EPS fell by 33% and over the past three years, the total loss to shareholders 72%

The results at Associate Global Partners Limited (ASX:APL) have been quite disappointing recently and CEO Marty Switzer bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 13th of November. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. The data we present below explains why we think CEO compensation is not consistent with recent performance.

View our latest analysis for Associate Global Partners

Comparing Associate Global Partners Limited's CEO Compensation With The Industry

According to our data, Associate Global Partners Limited has a market capitalization of AU$9.0m, and paid its CEO total annual compensation worth AU$630k over the year to June 2023. We note that's an increase of 27% above last year. In particular, the salary of AU$470.0k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the Australian Capital Markets industry with market capitalizations under AU$307m, the reported median total CEO compensation was AU$484k. Hence, we can conclude that Marty Switzer is remunerated higher than the industry median. What's more, Marty Switzer holds AU$289k worth of shares in the company in their own name.

Component	2023	2022	Proportion (2023)
Salary	AU$470k	AU$451k	75%
Other	AU$160k	AU$45k	25%
Total Compensation	AU$630k	AU$496k	100%

Talking in terms of the industry, salary represented approximately 65% of total compensation out of all the companies we analyzed, while other remuneration made up 35% of the pie. It's interesting to note that Associate Global Partners pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Associate Global Partners Limited's Growth

Over the last three years, Associate Global Partners Limited has shrunk its earnings per share by 33% per year. Its revenue is down 9.6% over the previous year.

Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Associate Global Partners Limited Been A Good Investment?

The return of -72% over three years would not have pleased Associate Global Partners Limited shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

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 4 warning signs for Associate Global Partners (of which 3 are potentially serious!) 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.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.