This article will reflect on the compensation paid to Shaun Ankers who has served as CEO of Energy One Limited (ASX:EOL) since 2010. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
View our latest analysis for Energy One
Comparing Energy One Limited's CEO Compensation With the industry
At the time of writing, our data shows that Energy One Limited has a market capitalization of AU$161m, and reported total annual CEO compensation of AU$831k for the year to June 2020. We note that's an increase of 29% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at AU$372k.
In comparison with other companies in the industry with market capitalizations under AU$260m, the reported median total CEO compensation was AU$337k. Hence, we can conclude that Shaun Ankers is remunerated higher than the industry median. Furthermore, Shaun Ankers directly owns AU$5.2m worth of shares in the company, implying that they are deeply invested in the company's success.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | AU$372k | AU$351k | 45% |
| Other | AU$459k | AU$291k | 55% |
| Total Compensation | AU$831k | AU$642k | 100% |
Talking in terms of the industry, salary represented approximately 60% of total compensation out of all the companies we analyzed, while other remuneration made up 40% of the pie. Energy One sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
Energy One Limited's Growth
Energy One Limited's earnings per share (EPS) grew 66% per year over the last three years. Its revenue is up 29% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Energy One Limited Been A Good Investment?
Boasting a total shareholder return of 827% over three years, Energy One Limited has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
To Conclude...
As we noted earlier, Energy One pays its CEO higher than the norm for similar-sized companies belonging to the same industry. However, Energy One has produced strong EPS growth and shareholder returns over the last three years. So, in acknowledgment of the overall excellent performance, we believe CEO compensation is appropriate. The pleasing shareholder returns are the cherry on top. We wouldn't be wrong in saying that shareholders feel that Shaun's performance creates value for the company.
CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 3 warning signs for Energy One that you should be aware of before investing.
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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Access Free AnalysisThis 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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About ASX:EOL
Energy One
Provides software products, outsourced operations, and advisory services to wholesale energy, environmental, and carbon trading markets in the Australasia, and Europe.
Reasonable growth potential with mediocre balance sheet.
