How Does WestStar Industrial's (ASX:WSI) CEO Salary Compare to Peers?

Robert Spadanuda is the CEO of WestStar Industrial Limited (ASX:WSI), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for WestStar Industrial.

View our latest analysis for WestStar Industrial

How Does Total Compensation For Robert Spadanuda Compare With Other Companies In The Industry?

Our data indicates that WestStar Industrial Limited has a market capitalization of AU$19m, and total annual CEO compensation was reported as AU$201k for the year to June 2020. That is, the compensation was roughly the same as last year. We note that the salary portion, which stands at AU$160.0k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under AU$258m, the reported median total CEO compensation was AU$306k. This suggests that Robert Spadanuda is paid below the industry median.

Speaking on an industry level, nearly 69% of total compensation represents salary, while the remainder of 31% is other remuneration. WestStar Industrial pays out 79% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

WestStar Industrial Limited's Growth

WestStar Industrial Limited has seen its earnings per share (EPS) increase by 122% a year over the past three years. In the last year, its revenue is up 118%.

Shareholders would be glad to know that the company has improved itself over the last few years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. 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 WestStar Industrial Limited Been A Good Investment?

Given the total shareholder loss of 22% over three years, many shareholders in WestStar Industrial Limited are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be lessto generous with CEO compensation.

In Summary...

As we touched on above, WestStar Industrial Limited is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. However we must not forget that the EPS growth has been very strong over three years. Although we would've liked to see positive investor returns, it would be bold of us to criticize CEO compensation when EPS are up. But we believe shareholders would want to see healthier returns before the CEO gets a raise.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for WestStar Industrial that investors should think about before committing capital to this stock.

Important note: WestStar Industrial 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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