Innlanz Limited's (ASX:INL) CEO Compensation Looks Acceptable To Us And Here's Why

Key Insights

• Innlanz to hold its Annual General Meeting on 16th of November
• CEO Yesh Mudaliar's total compensation includes salary of AU$100.0k
• Total compensation is 86% below industry average
• Innlanz's EPS grew by 87% over the past three years while total shareholder loss over the past three years was 88%

The performance at Innlanz Limited (ASX:INL) has been rather lacklustre of late and shareholders may be wondering what CEO Yesh Mudaliar is planning to do about this. They will get a chance to exercise their voting power to influence the future direction of the company in the next AGM on 16th of November. 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.

View our latest analysis for Innlanz

How Does Total Compensation For Yesh Mudaliar Compare With Other Companies In The Industry?

Our data indicates that Innlanz Limited has a market capitalization of AU$3.4m, and total annual CEO compensation was reported as AU$111k for the year to June 2023. That's mostly flat as compared to the prior year's compensation. We note that the salary portion, which stands at AU$100.0k constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the Australian Specialty Retail industry with market capitalizations below AU$315m, reported a median total CEO compensation of AU$815k. That is to say, Yesh Mudaliar is paid under the industry median.

Component	2023	2022	Proportion (2023)
Salary	AU$100k	AU$100k	90%
Other	AU$11k	AU$10k	10%
Total Compensation	AU$111k	AU$110k	100%

Talking in terms of the industry, salary represented approximately 53% of total compensation out of all the companies we analyzed, while other remuneration made up 47% of the pie. It's interesting to note that Innlanz pays out a greater portion of remuneration through salary, compared to the industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Innlanz Limited's Growth

Over the past three years, Innlanz Limited has seen its earnings per share (EPS) grow by 87% per year. It achieved revenue growth of 66% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent 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 Innlanz Limited Been A Good Investment?

With a total shareholder return of -88% over three years, Innlanz Limited shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

The loss to shareholders over the past three years is certainly concerning. This diverges with the robust growth in EPS, suggesting that there is a large discrepancy between share price and fundamentals. There needs to be more focus by management and the board to examine why the share price has diverged from fundamentals. 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.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 3 warning signs for Innlanz (2 are a bit unpleasant!) that you should be aware of before investing here.

Switching gears from Innlanz, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.