Does Integrated Payment Technologies' (ASX:IP1) CEO Salary Compare Well With Industry Peers?

This article will reflect on the compensation paid to Dean Martin who has served as CEO of Integrated Payment Technologies Limited (ASX:IP1) since 2018. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

Check out our latest analysis for Integrated Payment Technologies

How Does Total Compensation For Dean Martin Compare With Other Companies In The Industry?

At the time of writing, our data shows that Integrated Payment Technologies Limited has a market capitalization of AU$50m, and reported total annual CEO compensation of AU$261k for the year to June 2020. We note that's an increase of 31% above last year. Notably, the salary which is AU$196.0k, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations under AU$254m, the reported median total CEO compensation was AU$416k. In other words, Integrated Payment Technologies pays its CEO lower than the industry median.

Speaking on an industry level, nearly 46% of total compensation represents salary, while the remainder of 54% is other remuneration. According to our research, Integrated Payment Technologies 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.

Integrated Payment Technologies Limited's Growth

Integrated Payment Technologies Limited has reduced its earnings per share by 18% a year over the last three years. Its revenue is down 17% over the previous year.

Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 Integrated Payment Technologies Limited Been A Good Investment?

Integrated Payment Technologies Limited has served shareholders reasonably well, with a total return of 21% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.

To Conclude...

As previously discussed, Dean is compensated less than what is normal for CEOs of companies of similar size, and which belong to the same industry. Over the last three years, shareholder returns have been unexciting, and EPS growth has fared even worse. So, although we can't say CEO compensation is very high, shareholders might want to see an improvement in overall performance before agreeing that Dean deserves a bump.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 5 warning signs (and 2 which can't be ignored) in Integrated Payment Technologies we think you should know about.

Switching gears from Integrated Payment Technologies, 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. 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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