What Does Event Hospitality & Entertainment's (ASX:EVT) CEO Pay Reveal?

Jane Hastings has been the CEO of Event Hospitality & Entertainment Limited (ASX:EVT) since 2017, and this article will examine the executive's compensation 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 Event Hospitality & Entertainment.

View our latest analysis for Event Hospitality & Entertainment

Comparing Event Hospitality & Entertainment Limited's CEO Compensation With the industry

At the time of writing, our data shows that Event Hospitality & Entertainment Limited has a market capitalization of AU$1.5b, and reported total annual CEO compensation of AU$2.4m for the year to June 2020. Notably, that's a decrease of 17% over the year before. Notably, the salary which is AU$1.43m, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations ranging from AU$519m to AU$2.1b, the reported median CEO total compensation was AU$1.1m. Hence, we can conclude that Jane Hastings is remunerated higher than the industry median. What's more, Jane Hastings holds AU$114k worth of shares in the company in their own name.

Speaking on an industry level, nearly 90% of total compensation represents salary, while the remainder of 10% is other remuneration. Event Hospitality & Entertainment sets aside a smaller share of compensation for 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.

Event Hospitality & Entertainment Limited's Growth

Event Hospitality & Entertainment Limited has reduced its earnings per share by 27% a year over the last three years. In the last year, its revenue is down 25%.

Overall this is not a very positive result for shareholders. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Event Hospitality & Entertainment Limited Been A Good Investment?

Since shareholders would have lost about 25% over three years, some Event Hospitality & Entertainment 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 we noted earlier, Event Hospitality & Entertainment pays its CEO higher than the norm for similar-sized companies belonging to the same industry. Disappointingly, share price gains over the last three years have failed to materialize. Arguably worse, we've been waiting for positive EPS growth for the last three years. Overall, with such poor performance, shareholder's would probably have questions if the company decided to give the CEO a raise.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 1 warning sign for Event Hospitality & Entertainment that investors should look into moving forward.

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. 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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