Shareholders May Not Be So Generous With Capral Limited's (ASX:CAA) CEO Compensation And Here's Why

Key Insights

• Capral will host its Annual General Meeting on 8th of May
• Total pay for CEO Tony Dragicevich includes AU$702.3k salary
• Total compensation is 294% above industry average
• Capral's EPS grew by 4.8% over the past three years while total shareholder return over the past three years was 65%

Under the guidance of CEO Tony Dragicevich, Capral Limited (ASX:CAA) has performed reasonably well recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 8th of May. However, some shareholders will still be cautious of paying the CEO excessively.

See our latest analysis for Capral

Comparing Capral Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Capral Limited has a market capitalization of AU$173m, and reported total annual CEO compensation of AU$1.5m for the year to December 2023. That's a fairly small increase of 5.1% over the previous year. While we always look at total compensation first, our analysis shows that the salary component is less, at AU$702k.

On comparing similar-sized companies in the Australian Metals and Mining industry with market capitalizations below AU$309m, we found that the median total CEO compensation was AU$392k. Accordingly, our analysis reveals that Capral Limited pays Tony Dragicevich north of the industry median. Furthermore, Tony Dragicevich directly owns AU$6.1m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	AU$702k	AU$700k	45%
Other	AU$841k	AU$768k	55%
Total Compensation	AU$1.5m	AU$1.5m	100%

Speaking on an industry level, nearly 63% of total compensation represents salary, while the remainder of 37% is other remuneration. In Capral's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Capral Limited's Growth

Capral Limited has seen its earnings per share (EPS) increase by 4.8% a year over the past three years. In the last year, its revenue is down 4.4%.

We would argue that the lack of revenue growth in the last year is less than ideal, but the modest EPS growth gives us some relief. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Capral Limited Been A Good Investment?

Most shareholders would probably be pleased with Capral Limited for providing a total return of 65% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 2 warning signs for Capral (of which 1 is potentially serious!) 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.