Stock Analysis

Here's Why Healthia Limited's (ASX:HLA) CEO May Deserve A Raise

ASX:HLA
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The solid performance at Healthia Limited (ASX:HLA) has been impressive and shareholders will probably be pleased to know that CEO Wes Coote has delivered. At the upcoming AGM on 17 November 2021, they will get a chance to hear the board review the company results, discuss future strategy and cast their vote on any resolutions such as executive remuneration. We think the CEO has done a pretty decent job and probably deserves a well-earned pay rise.

Check out our latest analysis for Healthia

How Does Total Compensation For Wes Coote Compare With Other Companies In The Industry?

At the time of writing, our data shows that Healthia Limited has a market capitalization of AU$249m, and reported total annual CEO compensation of AU$400k for the year to June 2021. Notably, that's an increase of 28% over the year before. Notably, the salary which is AU$306.2k, represents most of the total compensation being paid.

For comparison, other companies in the same industry with market capitalizations ranging between AU$135m and AU$539m had a median total CEO compensation of AU$986k. That is to say, Wes Coote is paid under the industry median. Furthermore, Wes Coote directly owns AU$4.0m worth of shares in the company, implying that they are deeply invested in the company's success.

Component20212020Proportion (2021)
Salary AU$306k AU$225k 76%
Other AU$94k AU$88k 24%
Total CompensationAU$400k AU$313k100%

Speaking on an industry level, nearly 58% of total compensation represents salary, while the remainder of 42% is other remuneration. It's interesting to note that Healthia pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

ceo-compensation
ASX:HLA CEO Compensation November 10th 2021

Healthia Limited's Growth

Healthia Limited's earnings per share (EPS) grew 123% per year over the last three years. In the last year, its revenue is up 57%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Healthia Limited Been A Good Investment?

Boasting a total shareholder return of 86% over three years, Healthia Limited has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. However, investors will get the chance to engage on key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We did our research and identified 4 warning signs (and 1 which shouldn't be ignored) in Healthia we think you should know about.

Switching gears from Healthia, 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.

Valuation is complex, but we're helping make it simple.

Find out whether Healthia is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

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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.

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