Shareholders May Not Be So Generous With Helios Energy Limited's (ASX:HE8) CEO Compensation And Here's Why

Key Insights

• Helios Energy will host its Annual General Meeting on 30th of November
• Salary of AU$357.7k is part of CEO Peng He's total remuneration
• The overall pay is comparable to the industry average
• Helios Energy's three-year loss to shareholders was 63% while its EPS grew by 31% over the past three years

Shareholders of Helios Energy Limited (ASX:HE8) will have been dismayed by the negative share price return over the last three years. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 30th of November. They could also influence management through voting on resolutions such as executive remuneration. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

Check out our latest analysis for Helios Energy

Comparing Helios Energy Limited's CEO Compensation With The Industry

According to our data, Helios Energy Limited has a market capitalization of AU$164m, and paid its CEO total annual compensation worth AU$358k over the year to June 2023. That's a fairly small increase of 7.8% over the previous year. Notably, the salary of AU$358k is the entirety of the CEO compensation.

For comparison, other companies in the Australian Oil and Gas industry with market capitalizations below AU$304m, reported a median total CEO compensation of AU$430k. So it looks like Helios Energy compensates Peng He in line with the median for the industry.

Component	2023	2022	Proportion (2023)
Salary	AU$358k	AU$332k	100%
Other	-	-	-
Total Compensation	AU$358k	AU$332k	100%

Speaking on an industry level, nearly 62% of total compensation represents salary, while the remainder of 38% is other remuneration. Speaking on a company level, Helios Energy prefers to tread along a traditional path, disbursing all compensation through a salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Helios Energy Limited's Growth

Over the past three years, Helios Energy Limited has seen its earnings per share (EPS) grow by 31% per year. It achieved revenue growth of 229% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. 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 Helios Energy Limited Been A Good Investment?

With a total shareholder return of -63% over three years, Helios Energy Limited shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Helios Energy rewards its CEO solely through a salary, ignoring non-salary benefits completely. Shareholders have not seen their shares grow in value, rather they have seen their shares decline. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would be keen to know what's holding the stock back when earnings have grown. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 3 warning signs for Helios Energy that you should be aware of before investing.

Switching gears from Helios Energy, 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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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.