It's Unlikely That The CEO Of Clean Seas Seafood Limited (ASX:CSS) Will See A Huge Pay Rise This Year

Key Insights

• Clean Seas Seafood's Annual General Meeting to take place on 6th of November
• Total pay for CEO Rob Gratton includes AU$447.5k salary
• Total compensation is similar to the industry average
• Clean Seas Seafood's EPS grew by 14% over the past three years while total shareholder loss over the past three years was 66%

The underwhelming share price performance of Clean Seas Seafood Limited (ASX:CSS) in the past three years would have disappointed many shareholders. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 6th of November. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. We discuss below why we think shareholders should be cautious of approving a raise for the CEO at the moment.

Check out our latest analysis for Clean Seas Seafood

How Does Total Compensation For Rob Gratton Compare With Other Companies In The Industry?

According to our data, Clean Seas Seafood Limited has a market capitalization of AU$44m, and paid its CEO total annual compensation worth AU$486k over the year to June 2024. We note that's a decrease of 32% compared to last year. In particular, the salary of AU$447.5k, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the Australian Food industry with market capitalizations below AU$304m, reported a median total CEO compensation of AU$419k. From this we gather that Rob Gratton is paid around the median for CEOs in the industry. What's more, Rob Gratton holds AU$111k worth of shares in the company in their own name.

Component	2024	2023	Proportion (2024)
Salary	AU$448k	AU$451k	92%
Other	AU$39k	AU$259k	8%
Total Compensation	AU$486k	AU$710k	100%

Talking in terms of the industry, salary represented approximately 62% of total compensation out of all the companies we analyzed, while other remuneration made up 38% of the pie. Clean Seas Seafood is paying a higher share of its remuneration through a salary in comparison to the overall industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Clean Seas Seafood Limited's Growth Numbers

Clean Seas Seafood Limited has seen its earnings per share (EPS) increase by 14% a year over the past three years. The trailing twelve months of revenue was pretty much the same as the prior period.

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 Clean Seas Seafood Limited Been A Good Investment?

The return of -66% over three years would not have pleased Clean Seas Seafood Limited shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

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 probably be keen to find out what are the other factors could be weighing down the stock. 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.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 4 warning signs for Clean Seas Seafood that investors should be aware of in a dynamic business environment.

Important note: Clean Seas Seafood is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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.