Keith Cullen is the CEO of WT Financial Group Limited (ASX:WTL), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also assess whether WT Financial Group pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
See our latest analysis for WT Financial Group
How Does Total Compensation For Keith Cullen Compare With Other Companies In The Industry?
Our data indicates that WT Financial Group Limited has a market capitalization of AU$11m, and total annual CEO compensation was reported as AU$398k for the year to June 2020. That's a modest increase of 3.6% on the prior year. In particular, the salary of AU$298.3k, makes up a huge portion of the total compensation being paid to the CEO.
In comparison with other companies in the industry with market capitalizations under AU$258m, the reported median total CEO compensation was AU$588k. In other words, WT Financial Group pays its CEO lower than the industry median. What's more, Keith Cullen holds AU$2.3m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | AU$298k | AU$298k | 75% |
| Other | AU$100k | AU$86k | 25% |
| Total Compensation | AU$398k | AU$384k | 100% |
On an industry level, roughly 61% of total compensation represents salary and 39% is other remuneration. According to our research, WT Financial Group has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
A Look at WT Financial Group Limited's Growth Numbers
WT Financial Group Limited's earnings per share (EPS) grew 38% per year over the last three years. It achieved revenue growth of 15% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. 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 WT Financial Group Limited Been A Good Investment?
With a three year total loss of 32% for the shareholders, WT Financial Group Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
As previously discussed, Keith is compensated less than what is normal for CEOs of companies of similar size, and which belong to the same industry. However, the EPS growth over three years is certainly impressive. Although we would've liked to see positive investor returns, it would be bold of us to criticize CEO compensation when EPS are up. But shareholders will likely want to hold off on any raise for Keith until investor returns are positive.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 4 warning signs for WT Financial Group (of which 3 don't sit too well with us!) that you should know about in order to have a holistic understanding of the stock.
Switching gears from WT Financial Group, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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Access Free AnalysisThis 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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About ASX:WTL
Excellent balance sheet and good value.
