In This Article:
Martin Ward has been the CEO of AP Eagers Limited (ASX:APE) since 2006. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. 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.
See our latest analysis for A.P. Eagers
How Does Martin Ward’s Compensation Compare With Similar Sized Companies?
According to our data, AP Eagers Limited has a market capitalization of AU$1.3b, and pays its CEO total annual compensation worth AU$2.2m. (This number is for the twelve months until 2017). While we always look at total compensation first, we note that the salary component is less, at AU$1.2m. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of AU$543m to AU$2.2b. The median total CEO compensation was AU$1.6m.
It would therefore appear that AP Eagers Limited pays Martin Ward more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at A.P. Eagers, below.
Is AP Eagers Limited Growing?
On average over the last three years, AP Eagers Limited has grown earnings per share (EPS) by 3.2% each year. In the last year, its revenue is up 2.3%.
I’m not particularly impressed by the revenue growth, but the modest improvement in EPS is good. Considering these factors I’d say performance has been pretty decent, though not amazing.
You might want to check this free visual report on analyst forecasts for future earnings.
Has AP Eagers Limited Been A Good Investment?
With a three year total loss of 30%, AP Eagers Limited would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.
In Summary…
We compared the total CEO remuneration paid by AP Eagers Limited, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
Over the last three years, shareholder returns have been downright disappointing, and the underlying business has failed to impress us. Shareholders may wish to consider further research. Although we don’t think the CEO pay is too high, it is probably more on the generous side of things. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling AP Eagers (free visualization of insider trades).