Stock Analysis

Shareholders Will Probably Hold Off On Increasing Greenland Minerals Limited's (ASX:GGG) CEO Compensation For The Time Being

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Under the guidance of CEO John Mair, Greenland Minerals Limited (ASX:GGG) 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 26 May 2021. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

Check out our latest analysis for Greenland Minerals

How Does Total Compensation For John Mair Compare With Other Companies In The Industry?

According to our data, Greenland Minerals Limited has a market capitalization of AU$119m, and paid its CEO total annual compensation worth AU$413k over the year to December 2020. We note that's an increase of 21% above last year. We note that the salary portion, which stands at AU$350.0k constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the industry with market capitalizations below AU$257m, reported a median total CEO compensation of AU$303k. This suggests that John Mair is paid more than the median for the industry. Moreover, John Mair also holds AU$744k worth of Greenland Minerals stock directly under their own name.

Component20202019Proportion (2020)
Salary AU$350k AU$350k 85%
Other AU$63k 15%
Total CompensationAU$413k AU$341k100%

On an industry level, around 69% of total compensation represents salary and 31% is other remuneration. Greenland Minerals is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

ASX:GGG CEO Compensation May 19th 2021

A Look at Greenland Minerals Limited's Growth Numbers

Earnings per share at Greenland Minerals Limited are much the same as they were three years ago, albeit with slightly higher. It achieved revenue growth of 146% over the last year.

It's great to see that revenue growth is strong. Combined with modest EPS growth, we get a good impression of the company. We wouldn't say this is necessarily top notch growth, but it is certainly promising. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Greenland Minerals Limited Been A Good Investment?

With a total shareholder return of 7.2% over three years, Greenland Minerals Limited has done okay by shareholders, but there's always room for improvement. As a result, investors in the company might be reluctant about agreeing to increase CEO pay in the future, before seeing an improvement on their returns.

In Summary...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 4 warning signs for Greenland Minerals (of which 1 shouldn't be ignored!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from Greenland Minerals, 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.

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