We Take A Look At Why Seeing Machines Limited's (LON:SEE) CEO Compensation Is Well Earned

The performance at Seeing Machines Limited (LON:SEE) has been quite strong recently and CEO Paul McGlone has played a role in it. Shareholders will have this at the front of their minds in the upcoming AGM on 28 November 2022. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.

View our latest analysis for Seeing Machines

Comparing Seeing Machines Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Seeing Machines Limited has a market capitalization of UK£279m, and reported total annual CEO compensation of AU$1.1m for the year to June 2022. That's just a smallish increase of 5.9% on last year. In particular, the salary of AU$885.0k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar companies from the same industry with market caps ranging from UK£168m to UK£671m, we found that the median CEO total compensation was AU$1.1m. This suggests that Seeing Machines remunerates its CEO largely in line with the industry average.

Component	2022	2021	Proportion (2022)
Salary	AU$885k	AU$705k	79%
Other	AU$239k	AU$356k	21%
Total Compensation	AU$1.1m	AU$1.1m	100%

On an industry level, around 75% of total compensation represents salary and 25% is other remuneration. There isn't a significant difference between Seeing Machines and the broader market, in terms of salary allocation in the overall compensation package. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Seeing Machines Limited's Growth Numbers

Seeing Machines Limited's earnings per share (EPS) grew 54% per year over the last three years. It achieved revenue growth of 15% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Seeing Machines Limited Been A Good Investment?

Most shareholders would probably be pleased with Seeing Machines Limited for providing a total return of 61% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

Given the improved performance, shareholders may be more forgiving of CEO compensation in the upcoming AGM. In saying that, some shareholders may feel that the more important issues to be addressed may be how the management plans to steer the company towards sustainable profitability in the future.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 1 warning sign for Seeing Machines that investors should look into moving forward.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.