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Graeme Dunn has been the CEO of Southern Cross Electrical Engineering Limited (ASX:SXE) since 2016. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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.
See our latest analysis for Southern Cross Electrical Engineering
How Does Graeme Dunn's Compensation Compare With Similar Sized Companies?
According to our data, Southern Cross Electrical Engineering Limited has a market capitalization of AU$131m, and pays its CEO total annual compensation worth AU$1.1m. (This is based on the year to June 2018). We think total compensation is more important but we note that the CEO salary is lower, at AU$625k. We took a group of companies with market capitalizations below AU$284m, and calculated the median CEO total compensation to be AU$354k.
It would therefore appear that Southern Cross Electrical Engineering Limited pays Graeme Dunn 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. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see a visual representation of the CEO compensation at Southern Cross Electrical Engineering, below.
Is Southern Cross Electrical Engineering Limited Growing?
On average over the last three years, Southern Cross Electrical Engineering Limited has grown earnings per share (EPS) by 94% each year (using a line of best fit). It achieved revenue growth of 12% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Shareholders might be interested in this free visualization of analyst forecasts.
Has Southern Cross Electrical Engineering Limited Been A Good Investment?
Southern Cross Electrical Engineering Limited has generated a total shareholder return of 13% over three years, so most shareholders would be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.