Shareholders Will Probably Not Have Any Issues With Nyrada Inc.'s (ASX:NYR) CEO Compensation

Key Insights

• Nyrada will host its Annual General Meeting on 19th of November
• Salary of AU$294.2k is part of CEO James Bonnar's total remuneration
• Total compensation is 42% below industry average
• Over the past three years, Nyrada's EPS grew by 34% and over the past three years, the total loss to shareholders 90%

The performance at Nyrada Inc. (ASX:NYR) has been rather lacklustre of late and shareholders may be wondering what CEO James Bonnar is planning to do about this. At the next AGM coming up on 19th of November, they can influence managerial decision making through voting on resolutions, including executive remuneration. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. We have prepared some analysis below to show that CEO compensation looks to be reasonable.

See our latest analysis for Nyrada

How Does Total Compensation For James Bonnar Compare With Other Companies In The Industry?

According to our data, Nyrada Inc. has a market capitalization of AU$3.1m, and paid its CEO total annual compensation worth AU$394k over the year to June 2023. We note that's a decrease of 15% compared to last year. In particular, the salary of AU$294.2k, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the Australian Pharmaceuticals industry with market capitalizations below AU$314m, reported a median total CEO compensation of AU$675k. That is to say, James Bonnar is paid under the industry median.

Component	2023	2022	Proportion (2023)
Salary	AU$294k	AU$274k	75%
Other	AU$100k	AU$190k	25%
Total Compensation	AU$394k	AU$464k	100%

On an industry level, around 61% of total compensation represents salary and 39% is other remuneration. According to our research, Nyrada has allocated a higher percentage of pay to salary in comparison to the wider 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.

A Look at Nyrada Inc.'s Growth Numbers

Over the past three years, Nyrada Inc. has seen its earnings per share (EPS) grow by 34% per year. In the last year, its revenue is up 31%.

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. 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 Nyrada Inc. Been A Good Investment?

Few Nyrada Inc. shareholders would feel satisfied with the return of -90% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

The fact that shareholders have earned a negative share price return is certainly disconcerting. The share price trend has diverged with the robust growth in EPS however, suggesting there may be other factors that could be driving the price performance. A key question may be why the fundamentals have not yet been reflected into the share price. The upcoming AGM will provide shareholders the opportunity to raise their concerns and evaluate if the board’s judgement and decision-making is aligned with their expectations.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 5 warning signs for Nyrada (4 can't be ignored!) 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. 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.