This article will reflect on the compensation paid to Tony Rovira who has served as CEO of Azure Minerals Limited (ASX:AZS) since 2003. This analysis will also assess whether Azure Minerals pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
How Does Total Compensation For Tony Rovira Compare With Other Companies In The Industry?
According to our data, Azure Minerals Limited has a market capitalization of AU$42m, and paid its CEO total annual compensation worth AU$470k over the year to June 2020. That's a slight decrease of 4.6% on the prior year. Notably, the salary which is AU$387.4k, represents most of the total compensation being paid.
On comparing similar-sized companies in the industry with market capitalizations below AU$285m, we found that the median total CEO compensation was AU$308k. This suggests that Tony Rovira is paid more than the median for the industry. Moreover, Tony Rovira also holds AU$141k worth of Azure Minerals stock directly under their own name.
Talking in terms of the industry, salary represented approximately 68% of total compensation out of all the companies we analyzed, while other remuneration made up 32% of the pie. It's interesting to note that Azure Minerals 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.
A Look at Azure Minerals Limited's Growth Numbers
Azure Minerals Limited has seen its earnings per share (EPS) increase by 16% a year over the past three years. It achieved revenue growth of 139% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. 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 Azure Minerals Limited Been A Good Investment?
Since shareholders would have lost about 49% over three years, some Azure Minerals Limited investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
As we noted earlier, Azure Minerals pays its CEO higher than the norm for similar-sized companies belonging to the same industry. However, the EPS growth is certainly impressive, but shareholder returns — over the same period — have been disappointing. Considering overall performance, we can't say Tony is underpaid, in fact compensation is definitely on the higher side.
CEO pay is simply one of the many factors that need to be considered while examining business performance. That's why we did our research, and identified 5 warning signs for Azure Minerals (of which 3 are significant!) 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. 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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