How Should Investors React To Zoono Group's (ASX:ZNO) CEO Pay?

The CEO of Zoono Group Limited (ASX:ZNO) is Paul Hyslop, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Zoono Group.

View our latest analysis for Zoono Group

How Does Total Compensation For Paul Hyslop Compare With Other Companies In The Industry?

At the time of writing, our data shows that Zoono Group Limited has a market capitalization of AU$227m, and reported total annual CEO compensation of NZ$428k for the year to June 2020. That's a notable increase of 13% on last year. In particular, the salary of NZ$377.9k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar companies from the same industry with market caps ranging from AU$136m to AU$544m, we found that the median CEO total compensation was NZ$600k. From this we gather that Paul Hyslop is paid around the median for CEOs in the industry. Moreover, Paul Hyslop also holds AU$93m worth of Zoono Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, roughly 69% of total compensation represents salary and 31% is other remuneration. Zoono Group is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Zoono Group Limited's Growth

Over the past three years, Zoono Group Limited has seen its earnings per share (EPS) grow by 123% per year. It achieved revenue growth of 2,050% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Zoono Group Limited Been A Good Investment?

Boasting a total shareholder return of 329% over three years, Zoono Group Limited has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

As we touched on above, Zoono Group Limited is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Investors would surely be happy to see that returns have been great, and that EPS is up. Indeed, many might consider that Paul is compensated rather modestly, given the solid company performance! Stockholders might even be okay with a bump in pay, seeing as how investor returns have been so strong.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 3 warning signs for Zoono Group (1 is concerning!) that you should be aware of before investing here.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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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