Brisbane Broncos Limited's (ASX:BBL) CEO Compensation Is Looking A Bit Stretched At The Moment

Key Insights

• Brisbane Broncos will host its Annual General Meeting on 28th of May
• Salary of AU$500.0k is part of CEO Dave Donaghy's total remuneration
• The overall pay is 166% above the industry average
• Over the past three years, Brisbane Broncos' EPS grew by 52% and over the past three years, the total shareholder return was 124%

CEO Dave Donaghy has done a decent job of delivering relatively good performance at Brisbane Broncos Limited (ASX:BBL) 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 28th of May. However, some shareholders may still want to keep CEO compensation within reason.

Check out our latest analysis for Brisbane Broncos

How Does Total Compensation For Dave Donaghy Compare With Other Companies In The Industry?

At the time of writing, our data shows that Brisbane Broncos Limited has a market capitalization of AU$95m, and reported total annual CEO compensation of AU$706k for the year to December 2023. Notably, that's an increase of 13% over the year before. In particular, the salary of AU$500.0k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the Australia Entertainment industry with market capitalizations under AU$300m, the reported median total CEO compensation was AU$265k. This suggests that Dave Donaghy is paid more than the median for the industry.

Component	2023	2022	Proportion (2023)
Salary	AU$500k	AU$500k	71%
Other	AU$206k	AU$124k	29%
Total Compensation	AU$706k	AU$624k	100%

On an industry level, roughly 77% of total compensation represents salary and 23% is other remuneration. There isn't a significant difference between Brisbane Broncos and the broader market, in terms of salary allocation in the overall compensation package. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Brisbane Broncos Limited's Growth Numbers

Brisbane Broncos Limited has seen its earnings per share (EPS) increase by 52% a year over the past three years. In the last year, its revenue is up 26%.

This demonstrates that the company has been improving recently and is good news for the shareholders. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. 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 Brisbane Broncos Limited Been A Good Investment?

Most shareholders would probably be pleased with Brisbane Broncos Limited for providing a total return of 124% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Brisbane Broncos that you should be aware of before investing.

Important note: Brisbane Broncos 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. 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.