This article will reflect on the compensation paid to Cathy Zhai who has served as CEO of Monument Mining Limited (CVE:MMY) since 2018. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Monument Mining.
Check out our latest analysis for Monument Mining
Comparing Monument Mining Limited's CEO Compensation With the industry
At the time of writing, our data shows that Monument Mining Limited has a market capitalization of CA$44m, and reported total annual CEO compensation of US$363k for the year to June 2020. That's a slightly lower by 3.3% over the previous year. Notably, the salary which is US$330.8k, represents most of the total compensation being paid.
On comparing similar-sized companies in the industry with market capitalizations below CA$254m, we found that the median total CEO compensation was US$118k. Accordingly, our analysis reveals that Monument Mining Limited pays Cathy Zhai north of the industry median. What's more, Cathy Zhai holds CA$232k worth of shares in the company in their own name.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | US$331k | US$344k | 91% |
| Other | US$32k | US$32k | 9% |
| Total Compensation | US$363k | US$376k | 100% |
On an industry level, around 94% of total compensation represents salary and 6.3% is other remuneration. Monument Mining is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Monument Mining Limited's Growth
Over the past three years, Monument Mining Limited has seen its earnings per share (EPS) grow by 95% per year. It achieved revenue growth of 35% 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. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Monument Mining Limited Been A Good Investment?
Boasting a total shareholder return of 108% over three years, Monument Mining 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 previously discussed, Cathy is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Importantly though, EPS growth and shareholder returns are very impressive over the last three years. So, in acknowledgment of the overall excellent performance, we believe CEO compensation is appropriate. Given the strong history of shareholder returns, the shareholders are probably very happy with Cathy's performance.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 5 warning signs for Monument Mining (of which 1 is a bit unpleasant!) that you should know about in order to have a holistic understanding of the stock.
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. 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 TSXV:MMY
Monument Mining
Operates as a gold producer, engages in the acquisition, exploration, and development of gold, precious metals, and other base metal properties in Canada, Australia, and Malaysia.
Flawless balance sheet with acceptable track record.
