It's Probably Less Likely That Karoon Energy Ltd's (ASX:KAR) CEO Will See A Huge Pay Rise This Year

Key Insights

• Karoon Energy's Annual General Meeting to take place on 22nd of May
• Salary of US$602.6k is part of CEO Julian Fowles's total remuneration
• The total compensation is similar to the average for the industry
• Karoon Energy's EPS grew by 82% over the past three years while total shareholder loss over the past three years was 4.8%

Our free stock report includes 2 warning signs investors should be aware of before investing in Karoon Energy. Read for free now.

In the past three years, shareholders of Karoon Energy Ltd (ASX:KAR) have seen a loss on their investment. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 22nd of May. They could also influence management through voting on resolutions such as executive remuneration. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

View our latest analysis for Karoon Energy

How Does Total Compensation For Julian Fowles Compare With Other Companies In The Industry?

At the time of writing, our data shows that Karoon Energy Ltd has a market capitalization of AU$1.2b, and reported total annual CEO compensation of US$1.4m for the year to December 2024. We note that's a small decrease of 5.9% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$603k.

In comparison with other companies in the Australian Oil and Gas industry with market capitalizations ranging from AU$618m to AU$2.5b, the reported median CEO total compensation was US$1.4m. This suggests that Karoon Energy remunerates its CEO largely in line with the industry average. Furthermore, Julian Fowles directly owns AU$2.8m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	US$603k	US$568k	43%
Other	US$810k	US$933k	57%
Total Compensation	US$1.4m	US$1.5m	100%

Speaking on an industry level, nearly 60% of total compensation represents salary, while the remainder of 40% is other remuneration. Karoon Energy pays a modest slice of remuneration through salary, as compared to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Karoon Energy Ltd's Growth Numbers

Karoon Energy Ltd's earnings per share (EPS) grew 82% per year over the last three years. Its revenue is down 6.0% 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. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Karoon Energy Ltd Been A Good Investment?

With a three year total loss of 4.8% for the shareholders, Karoon Energy Ltd would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. 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 is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 2 warning signs for Karoon Energy (of which 1 makes us a bit uncomfortable!) 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.