It Looks Like AdvanSix Inc.'s (NYSE:ASIX) CEO May Expect Their Salary To Be Put Under The Microscope

Key Insights

• AdvanSix to hold its Annual General Meeting on 13th of June
• Salary of US$1.01m is part of CEO Erin Kane's total remuneration
• Total compensation is similar to the industry average
• Over the past three years, AdvanSix's EPS fell by 67% and over the past three years, the total loss to shareholders 19%

AdvanSix Inc. (NYSE:ASIX) has not performed well recently and CEO Erin Kane will probably need to up their game. At the upcoming AGM on 13th of June, shareholders can hear from the board including their plans for turning around performance. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. We present the case why we think CEO compensation is out of sync with company performance.

View our latest analysis for AdvanSix

Comparing AdvanSix Inc.'s CEO Compensation With The Industry

Our data indicates that AdvanSix Inc. has a market capitalization of US$637m, and total annual CEO compensation was reported as US$4.7m for the year to December 2023. That's a notable decrease of 11% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$1.0m.

On comparing similar companies from the American Chemicals industry with market caps ranging from US$400m to US$1.6b, we found that the median CEO total compensation was US$4.2m. This suggests that AdvanSix remunerates its CEO largely in line with the industry average. Moreover, Erin Kane also holds US$11m worth of AdvanSix stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	US$1.0m	US$975k	21%
Other	US$3.7m	US$4.3m	79%
Total Compensation	US$4.7m	US$5.3m	100%

On an industry level, roughly 19% of total compensation represents salary and 81% is other remuneration. AdvanSix is paying a higher share of its remuneration through a salary in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

AdvanSix Inc.'s Growth

AdvanSix Inc. has reduced its earnings per share by 67% a year over the last three years. In the last year, its revenue is down 21%.

The decline in EPS is a bit concerning. 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. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has AdvanSix Inc. Been A Good Investment?

Given the total shareholder loss of 19% over three years, many shareholders in AdvanSix Inc. are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 2 warning signs for AdvanSix (1 is potentially serious!) that you should be aware of before investing here.

Switching gears from AdvanSix, 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.