Chris Richards became the CEO of Apiam Animal Health Limited (ASX:AHX) in 2015. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.

Check out our latest analysis for Apiam Animal Health

How Does Chris Richards's Compensation Compare With Similar Sized Companies?

According to our data, Apiam Animal Health Limited has a market capitalization of AU$50m, and paid its CEO total annual compensation worth AU$389k over the year to June 2019. That's below the compensation, last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at AU$350k. We examined a group of similar sized companies, with market capitalizations of below AU$296m. The median CEO total compensation in that group is AU$374k.

So Chris Richards is paid around the average of the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.

You can see a visual representation of the CEO compensation at Apiam Animal Health, below.

Is Apiam Animal Health Limited Growing?

Over the last three years Apiam Animal Health Limited has shrunk its earnings per share by an average of 1.3% per year (measured with a line of best fit). In the last year, its revenue is up 4.8%.

Unfortunately there is a complete lack of earnings per share improvement, over three years. The fairly low revenue growth fails to impress given that the earnings per share is down. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. It could be important to check this free visual depiction of what analysts expect for the future.

Has Apiam Animal Health Limited Been A Good Investment?

Since shareholders would have lost about 61% over three years, some Apiam Animal Health Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

Chris Richards is paid around what is normal the leaders of comparable size companies.

After looking at EPS and total shareholder returns, it's certainly hard to argue the company has performed well, since both metrics are down. Most would consider it prudent for the company to hold off any CEO pay rise until performance improves. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Apiam Animal Health (free visualization of insider trades).

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 spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

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