In 2016, Trangie Johnston was appointed CEO of Broken Hill Prospecting Limited (ASX:BPL). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
View our latest analysis for Broken Hill Prospecting
How Does Trangie Johnston's Compensation Compare With Similar Sized Companies?
According to our data, Broken Hill Prospecting Limited has a market capitalization of AU$3.0m, and paid its CEO total annual compensation worth AU$403k over the year to June 2019. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at AU$280k. We looked at a group of companies with market capitalizations under AU$306m, and the median CEO total compensation was AU$385k.
Next, let's break down remuneration compositions to understand how the industry and company compare with each other. Speaking on an industry level, we can see that nearly 69% of total compensation represents salary, while the remainder of 31% is other remuneration. Broken Hill Prospecting is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation
That means Trangie Johnston receives fairly typical remuneration for the CEO of a company that size. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context. You can see a visual representation of the CEO compensation at Broken Hill Prospecting, below.
Is Broken Hill Prospecting Limited Growing?
On average over the last three years, Broken Hill Prospecting Limited has shrunk earnings per share by 8.3% each year (measured with a line of best fit). Its revenue is down 67% over last year.
Sadly for shareholders, earnings per share are actually down, over three years. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Broken Hill Prospecting Limited Been A Good Investment?
Since shareholders would have lost about 50% over three years, some Broken Hill Prospecting Limited shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.