A Quick Analysis On Kaap Agri's (JSE:KAL) CEO Salary

The CEO of Kaap Agri Limited (JSE:KAL) is Sean Walsh, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Kaap Agri pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

Check out our latest analysis for Kaap Agri

Comparing Kaap Agri Limited's CEO Compensation With the industry

At the time of writing, our data shows that Kaap Agri Limited has a market capitalization of R2.4b, and reported total annual CEO compensation of R5.9m for the year to September 2020. Notably, that's a decrease of 18% over the year before. We note that the salary portion, which stands at R4.62m constitutes the majority of total compensation received by the CEO.

On comparing similar companies from the same industry with market caps ranging from R1.5b to R6.1b, we found that the median CEO total compensation was R7.2m. This suggests that Kaap Agri remunerates its CEO largely in line with the industry average. Furthermore, Sean Walsh directly owns R4.4m worth of shares in the company, implying that they are deeply invested in the company's success.

Talking in terms of the industry, salary represented approximately 51% of total compensation out of all the companies we analyzed, while other remuneration made up 49% of the pie. According to our research, Kaap Agri has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Kaap Agri Limited's Growth

Kaap Agri Limited's earnings per share (EPS) grew 4.6% per year over the last three years. Its revenue is up 1.4% over the last year.

We'd prefer higher revenue growth, but it is good to see modest EPS growth. Considering these factors we'd say performance has been pretty decent, though not amazing. 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 Kaap Agri Limited Been A Good Investment?

Given the total shareholder loss of 22% over three years, many shareholders in Kaap Agri Limited are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

As we noted earlier, Kaap Agri pays its CEO in line with similar-sized companies belonging to the same industry. Meanwhile, Kaap Agri is suffering from adverse shareholder returns and althoughEPS have grown over the past three years, they have not been extraordinary. CEO pay isn't exceptionally high, but considering poor performance, shareholders will likely hold off support for a raise until results improve.

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. We've identified 2 warning signs for Kaap Agri that investors should be aware of in a dynamic business environment.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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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