Here's What We Learned About The CEO Pay At Sebata Holdings Limited (JSE:SEB)

This article will reflect on the compensation paid to Greg Morris who has served as CEO of Sebata Holdings Limited (JSE:SEB) since 2011. This analysis will also assess whether Sebata Holdings pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Sebata Holdings

Comparing Sebata Holdings Limited's CEO Compensation With the industry

At the time of writing, our data shows that Sebata Holdings Limited has a market capitalization of R269m, and reported total annual CEO compensation of R1.1m for the year to March 2020. This means that the compensation hasn't changed much from last year. It is worth noting that the CEO compensation consists entirely of the salary, worth R1.1m.

On comparing similar-sized companies in the industry with market capitalizations below R2.9b, we found that the median total CEO compensation was R2.7m. That is to say, Greg Morris is paid under the industry median.

On an industry level, roughly 90% of total compensation represents salary and 10% is other remuneration. On a company level, Sebata Holdings prefers to reward its CEO through a salary, opting not to pay Greg Morris through non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Sebata Holdings Limited's Growth

Over the last three years, Sebata Holdings Limited has shrunk its earnings per share by 61% per year. Its revenue is up 2.1% over the last year.

Few shareholders would be pleased to read that EPS have declined. And the modest revenue growth over 12 months isn't much comfort against the reduced EPS. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Sebata Holdings Limited Been A Good Investment?

Since shareholders would have lost about 69% over three years, some Sebata Holdings Limited investors would surely be feeling negative emotions. So shareholders would probably want the company to be lessto generous with CEO compensation.

In Summary...

Sebata Holdings pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. As we touched on above, Sebata Holdings Limited is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. EPS growth has failed to impress us, and the same can be said about shareholder returns. Although we wouldn’t say CEO compensation is high, it’s tough to foresee shareholders warming up to thoughts of a bump anytime soon.

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 did our research and identified 3 warning signs (and 1 which doesn't sit too well with us) in Sebata Holdings we think you should know about.

Switching gears from Sebata Holdings, 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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