Most Shareholders Will Probably Find That The CEO Compensation For Carawine Resources Limited (ASX:CWX) Is Reasonable

Under the guidance of CEO David Boyd, Carawine Resources Limited (ASX:CWX) 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 22 December 2021. We present our case of why we think CEO compensation looks fair.

Check out our latest analysis for Carawine Resources

Comparing Carawine Resources Limited's CEO Compensation With the industry

At the time of writing, our data shows that Carawine Resources Limited has a market capitalization of AU$25m, and reported total annual CEO compensation of AU$385k for the year to June 2021. Notably, that's a decrease of 14% over the year before. In particular, the salary of AU$260.0k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the industry with market capitalizations under AU$281m, the reported median total CEO compensation was AU$357k. From this we gather that David Boyd is paid around the median for CEOs in the industry.

Component	2021	2020	Proportion (2021)
Salary	AU$260k	AU$260k	68%
Other	AU$125k	AU$188k	32%
Total Compensation	AU$385k	AU$448k	100%

On an industry level, around 59% of total compensation represents salary and 41% is other remuneration. According to our research, Carawine Resources has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Carawine Resources Limited's Growth

Carawine Resources Limited's earnings per share (EPS) grew 36% per year over the last three years. It saw its revenue drop 83% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. 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 Carawine Resources Limited Been A Good Investment?

Carawine Resources Limited has served shareholders reasonably well, with a total return of 19% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.

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 2 which shouldn't be ignored) in Carawine Resources we think you should know about.

Important note: Carawine Resources 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.