Is Azure Minerals Limited (ASX:AZS) Overpaying Its CEO?

By
Simply Wall St
Published
January 07, 2020
ASX:AZS

Tony Rovira became the CEO of Azure Minerals Limited (ASX:AZS) in 2003. First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for Azure Minerals

How Does Tony Rovira's Compensation Compare With Similar Sized Companies?

According to our data, Azure Minerals Limited has a market capitalization of AU$23m, and paid its CEO total annual compensation worth AU$493k over the year to June 2019. We think total compensation is more important but we note that the CEO salary is lower, at AU$417k. We examined a group of similar sized companies, with market capitalizations of below AU$289m. The median CEO total compensation in that group is AU$382k.

That means Tony Rovira receives fairly typical remuneration for the CEO of a company that size. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.

The graphic below shows how CEO compensation at Azure Minerals has changed from year to year.

ASX:AZS CEO Compensation, January 7th 2020
ASX:AZS CEO Compensation, January 7th 2020

Is Azure Minerals Limited Growing?

Over the last three years Azure Minerals Limited has grown its earnings per share (EPS) by an average of 7.8% per year (using a line of best fit). In the last year, its revenue is down 60%.

I generally like to see a little revenue growth, but the improvement in EPS is good. These two metric are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. We don't have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Azure Minerals Limited Been A Good Investment?

Since shareholders would have lost about 67% over three years, some Azure Minerals Limited shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Remuneration for Tony Rovira is close enough to the median pay for a CEO of a similar sized company .

We would like to see somewhat stronger per share growth. And shareholder returns have been disappointing over the last three years. So it would take a bold person to suggest the pay is too modest. Shareholders may want to check for free if Azure Minerals insiders are buying or selling shares.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.

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