It's Unlikely That Freightways Group Limited's (NZSE:FRW) CEO Will See A Huge Pay Rise This Year

Key Insights

• Freightways Group's Annual General Meeting to take place on 25th of October
• CEO Mark Troughear's total compensation includes salary of NZ$945.0k
• The overall pay is 31% above the industry average
• Freightways Group's EPS grew by 12% over the past three years while total shareholder return over the past three years was 12%

Under the guidance of CEO Mark Troughear, Freightways Group Limited (NZSE:FRW) has performed reasonably well recently. As shareholders go into the upcoming AGM on 25th of October, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for Freightways Group

Comparing Freightways Group Limited's CEO Compensation With The Industry

Our data indicates that Freightways Group Limited has a market capitalization of NZ$1.5b, and total annual CEO compensation was reported as NZ$1.8m for the year to June 2023. That's a modest increase of 7.5% on the prior year. In particular, the salary of NZ$945.0k, makes up a fairly large portion of the total compensation being paid to the CEO.

In comparison with other companies in the New Zealand Logistics industry with market capitalizations ranging from NZ$683m to NZ$2.7b, the reported median CEO total compensation was NZ$1.4m. Accordingly, our analysis reveals that Freightways Group Limited pays Mark Troughear north of the industry median. What's more, Mark Troughear holds NZ$3.7m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	NZ$945k	NZ$874k	53%
Other	NZ$848k	NZ$794k	47%
Total Compensation	NZ$1.8m	NZ$1.7m	100%

On an industry level, around 76% of total compensation represents salary and 24% is other remuneration. Freightways Group sets aside a smaller share of compensation for salary, in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Freightways Group Limited's Growth

Freightways Group Limited's earnings per share (EPS) grew 12% per year over the last three years. It achieved revenue growth of 28% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Freightways Group Limited Been A Good Investment?

Freightways Group Limited has served shareholders reasonably well, with a total return of 12% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 2 warning signs for Freightways Group that you should be aware of before investing.

Switching gears from Freightways Group, 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. 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.