Here's Why Shareholders Should Examine Acsion Limited's (JSE:ACS) CEO Compensation Package More Closely

Acsion Limited (JSE:ACS) has not performed well recently and CEO Kiriakos Anastasiadis will probably need to up their game. At the upcoming AGM on 19 August 2021, 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. The data we present below explains why we think CEO compensation is not consistent with recent performance.

Check out our latest analysis for Acsion

How Does Total Compensation For Kiriakos Anastasiadis Compare With Other Companies In The Industry?

According to our data, Acsion Limited has a market capitalization of R1.6b, and paid its CEO total annual compensation worth R2.7m over the year to February 2021. We note that's a decrease of 9.8% compared to last year. Notably, the salary which is R2.54m, represents most of the total compensation being paid.

On comparing similar-sized companies in the industry with market capitalizations below R3.0b, we found that the median total CEO compensation was R3.4m. From this we gather that Kiriakos Anastasiadis is paid around the median for CEOs in the industry.

Component	2021	2020	Proportion (2021)
Salary	R2.5m	R2.9m	95%
Other	R120k	-	5%
Total Compensation	R2.7m	R2.9m	100%

On an industry level, roughly 74% of total compensation represents salary and 26% is other remuneration. Acsion has gone down a largely traditional route, paying Kiriakos Anastasiadis a high salary, giving it preference over non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Acsion Limited's Growth

Acsion Limited has reduced its earnings per share by 69% a year over the last three years. In the last year, its revenue is up 1.5%.

The decline in EPS is a bit concerning. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in EPS. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Acsion Limited Been A Good Investment?

With a total shareholder return of -33% over three years, Acsion Limited shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Acsion pays its CEO a majority of compensation through a salary. Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. 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.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 4 warning signs for Acsion (1 is a bit concerning!) that you should be aware of before investing here.

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.

If you're looking for stocks to buy, use the lowest-cost* platform that is rated #1 Overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, forex, bonds and funds on 135 markets, all from a single integrated account. Promoted

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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

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