Shareholders May Be Wary Of Increasing Cue Energy Resources Limited's (ASX:CUE) CEO Compensation Package

Cue Energy Resources Limited (ASX:CUE) has not performed well recently and CEO Matthew Boyall will probably need to up their game. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 27 October 2021. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. The data we present below explains why we think CEO compensation is not consistent with recent performance.

See our latest analysis for Cue Energy Resources

Comparing Cue Energy Resources Limited's CEO Compensation With the industry

According to our data, Cue Energy Resources Limited has a market capitalization of AU$52m, and paid its CEO total annual compensation worth AU$514k over the year to June 2021. We note that's a small decrease of 5.8% on last year. We note that the salary portion, which stands at AU$356.7k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under AU$267m, the reported median total CEO compensation was AU$289k. This suggests that Matthew Boyall is paid more than the median for the industry.

Component	2021	2020	Proportion (2021)
Salary	AU$357k	AU$356k	69%
Other	AU$157k	AU$189k	31%
Total Compensation	AU$514k	AU$545k	100%

Talking in terms of the industry, salary represented approximately 71% of total compensation out of all the companies we analyzed, while other remuneration made up 29% of the pie. There isn't a significant difference between Cue Energy Resources 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 Cue Energy Resources Limited's Growth Numbers

Cue Energy Resources Limited has reduced its earnings per share by 105% a year over the last three years. It saw its revenue drop 6.1% over the last year.

Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Cue Energy Resources Limited Been A Good Investment?

Given the total shareholder loss of 5.1% over three years, many shareholders in Cue Energy Resources Limited are probably rather dissatisfied, to say the least. 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, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 1 warning sign for Cue Energy Resources that investors should think about before committing capital to this 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. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.