The CEO of Chatham Rock Phosphate Limited (NZSE:CRP) is Chris Castle, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Chatham Rock Phosphate pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Comparing Chatham Rock Phosphate Limited's CEO Compensation With the industry
At the time of writing, our data shows that Chatham Rock Phosphate Limited has a market capitalization of NZ$6.2m, and reported total annual CEO compensation of CA$124k for the year to March 2020. Notably, that's a decrease of 21% over the year before. It is worth noting that the CEO compensation consists entirely of the salary, worth CA$124k.
For comparison, other companies in the industry with market capitalizations below NZ$276m, reported a median total CEO compensation of CA$341k. This suggests that Chris Castle is paid below the industry median. Moreover, Chris Castle also holds NZ$91k worth of Chatham Rock Phosphate stock directly under their own name.
Speaking on an industry level, nearly 70% of total compensation represents salary, while the remainder of 30% is other remuneration. Speaking on a company level, Chatham Rock Phosphate prefers to tread along a traditional path, disbursing all compensation through a salary. 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.
Chatham Rock Phosphate Limited's Growth
Over the past three years, Chatham Rock Phosphate Limited has seen its earnings per share (EPS) grow by 61% per year. In the last year, its revenue is down 3.9%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. 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 Chatham Rock Phosphate Limited Been A Good Investment?
With a three year total loss of 60% for the shareholders, Chatham Rock Phosphate Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
Chatham Rock Phosphate rewards its CEO solely through a salary, ignoring non-salary benefits completely. As we touched on above, Chatham Rock Phosphate Limited is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. However, the EPS growth over three years is certainly impressive. Considering EPS are on the up, we would say Chris is compensated fairly. Shareholders, though, would ideally like to see shareholder returns head north before they agree to any raise.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 4 warning signs for Chatham Rock Phosphate you should be aware of, and 3 of them shouldn't be ignored.
Switching gears from Chatham Rock Phosphate, 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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