Golden State Mining Limited's (ASX:GSM) CEO Compensation Looks Acceptable To Us And Here's Why

Key Insights

• Golden State Mining will host its Annual General Meeting on 22nd of November
• CEO Mike Moore's total compensation includes salary of AU$225.0k
• The overall pay is 36% below the industry average
• Golden State Mining's EPS grew by 39% over the past three years while total shareholder loss over the past three years was 90%

The performance at Golden State Mining Limited (ASX:GSM) has been rather lacklustre of late and shareholders may be wondering what CEO Mike Moore is planning to do about this. They will get a chance to exercise their voting power to influence the future direction of the company in the next AGM on 22nd of November. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. We think CEO compensation looks appropriate given the data we have put together.

See our latest analysis for Golden State Mining

Comparing Golden State Mining Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Golden State Mining Limited has a market capitalization of AU$2.8m, and reported total annual CEO compensation of AU$250k for the year to June 2024. We note that's a decrease of 16% compared to last year. Notably, the salary which is AU$225.0k, represents most of the total compensation being paid.

In comparison with other companies in the Australian Metals and Mining industry with market capitalizations under AU$309m, the reported median total CEO compensation was AU$392k. This suggests that Mike Moore is paid below the industry median.

Component	2024	2023	Proportion (2024)
Salary	AU$225k	AU$225k	90%
Other	AU$25k	AU$71k	10%
Total Compensation	AU$250k	AU$296k	100%

On an industry level, around 63% of total compensation represents salary and 37% is other remuneration. Golden State Mining pays out 90% of remuneration in the form of a salary, significantly higher than the industry average. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Golden State Mining Limited's Growth

Golden State Mining Limited's earnings per share (EPS) grew 39% per year over the last three years. It has seen most of its revenue evaporate over the past year.

This demonstrates that the company has been improving recently and is good news for the shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Golden State Mining Limited Been A Good Investment?

With a total shareholder return of -90% over three years, Golden State Mining Limited shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

The fact that shareholders have earned a negative share price return is certainly disconcerting. This contrasts to the strong EPS growth recently however, and suggests that there may be other factors at play driving down the share price. A key question may be why the fundamentals have not yet been reflected into the share price. The upcoming AGM will provide shareholders the opportunity to raise their concerns and evaluate if the board’s judgement and decision-making is aligned with their expectations.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We identified 6 warning signs for Golden State Mining (4 are a bit concerning!) that you should be aware of before investing here.

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.