Greg Hall has been the CEO of Alligator Energy Limited (ASX:AGE) since 2018, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
View our latest analysis for Alligator Energy
Comparing Alligator Energy Limited's CEO Compensation With the industry
According to our data, Alligator Energy Limited has a market capitalization of AU$19m, and paid its CEO total annual compensation worth AU$111k over the year to June 2020. We note that's a decrease of 17% compared to last year. In particular, the salary of AU$74.8k, makes up a huge portion of the total compensation being paid to the CEO.
For comparison, other companies in the industry with market capitalizations below AU$263m, reported a median total CEO compensation of AU$353k. This suggests that Greg Hall is paid below the industry median. What's more, Greg Hall holds AU$151k worth of shares in the company in their own name.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | AU$75k | AU$90k | 67% |
| Other | AU$36k | AU$43k | 33% |
| Total Compensation | AU$111k | AU$133k | 100% |
Speaking on an industry level, nearly 76% of total compensation represents salary, while the remainder of 24% is other remuneration. In Alligator Energy's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader 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 Alligator Energy Limited's Growth Numbers
Alligator Energy Limited's earnings per share (EPS) grew 22% per year over the last three years. Its revenue is down 85% over the previous year.
Shareholders would be glad to know that the company has improved itself over the last few years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Alligator Energy Limited Been A Good Investment?
With a three year total loss of 16% for the shareholders, Alligator Energy Limited would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.
In Summary...
As we noted earlier, Alligator Energy pays its CEO lower than the norm for similar-sized companies belonging to the same industry. Importantly though, the company has impressed with its EPS growth over three years. It's tough to criticize CEO compensation when the per-share EPS movement is positive. But shareholders will likely want to hold off on any raise for Greg 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. We did our research and identified 6 warning signs (and 2 which are a bit unpleasant) in Alligator Energy we think you should know about.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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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About ASX:AGE
Alligator Energy
Engages in the mineral exploration activities in Australia and Italy.
Excellent balance sheet low.
