How Does VEEM's (ASX:VEE) CEO Salary Compare to Peers?

Mark Miocevich became the CEO of VEEM Ltd (ASX:VEE) in 1995, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for VEEM.

See our latest analysis for VEEM

Comparing VEEM Ltd's CEO Compensation With the industry

At the time of writing, our data shows that VEEM Ltd has a market capitalization of AU$78m, and reported total annual CEO compensation of AU$415k for the year to June 2020. That is, the compensation was roughly the same as last year. We note that the salary portion, which stands at AU$385.0k constitutes the majority of total compensation received by the CEO.

On comparing similar-sized companies in the industry with market capitalizations below AU$275m, we found that the median total CEO compensation was AU$367k. So it looks like VEEM compensates Mark Miocevich in line with the median for the industry. Furthermore, Mark Miocevich directly owns AU$48m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, around 80% of total compensation represents salary and 20% is other remuneration. According to our research, VEEM has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at VEEM Ltd's Growth Numbers

VEEM Ltd has reduced its earnings per share by 16% a year over the last three years. Its revenue is down 1.3% over the previous year.

Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 VEEM Ltd Been A Good Investment?

VEEM Ltd has served shareholders reasonably well, with a total return of 12% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.

To Conclude...

As previously discussed, Mark is compensated close to the median for companies of its size, and which belong to the same industry. VEEM has had a poor showing when it comes to EPS growth, and it's tough to say that shareholder returns have done much to excite us. This doesn't compare well with CEO compensation, which is close to the industry median. We would stop short of the compensation is inappropriate, but we can't say the executive is underpaid.

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 did our research and spotted 2 warning signs for VEEM that investors should look into moving forward.

Important note: VEEM is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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