Our Take On Todd River Resources' (ASX:TRT) CEO Salary

Will Dix has been the CEO of Todd River Resources Limited (ASX:TRT) since 2018, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Todd River Resources pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Todd River Resources

Comparing Todd River Resources Limited's CEO Compensation With the industry

According to our data, Todd River Resources Limited has a market capitalization of AU$22m, and paid its CEO total annual compensation worth AU$298k over the year to June 2020. Notably, that's a decrease of 32% over the year before. Notably, the salary which is AU$270.0k, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations under AU$259m, the reported median total CEO compensation was AU$307k. This suggests that Todd River Resources remunerates its CEO largely in line with the industry average. Furthermore, Will Dix directly owns AU$88k worth of shares in the company.

On an industry level, roughly 69% of total compensation represents salary and 31% is other remuneration. Todd River Resources 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.

Todd River Resources Limited's Growth

Over the past three years, Todd River Resources Limited has seen its earnings per share (EPS) grow by 38% per year. In the last year, its revenue is down 96%.

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. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Todd River Resources Limited Been A Good Investment?

Since shareholders would have lost about 63% over three years, some Todd River Resources Limited investors would surely be feeling negative emotions. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

As previously discussed, Will is compensated close to the median for companies of its size, and which belong to the same industry. Meanwhile, shareholder returns paint a sorry picture for the company, finishing in the red over the last three years. But EPS growth is moving in a favorable direction, certainly a positive sign. It's tough for us to say CEO compensation is too generous when EPS growth is positive, but negative investor returns will irk shareholders and reduce any chances of a raise.

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 6 warning signs for Todd River Resources (of which 4 shouldn't be ignored!) that you should know about in order to have a holistic understanding of the stock.

Important note: Todd River 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. 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.
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