Yahoo Finance Increases to Tower Limited's (NZSE:TWR) CEO Compensation Might Cool off for now
Key Insights
Tower's Annual General Meeting to take place on 20th of February
Salary of NZ$657.6k is part of CEO Blair Turnbull's total remuneration
Total compensation is 82% above industry average
Tower's total shareholder return over the past three years was 7.1% while its EPS was down 38% over the past three years
CEO Blair Turnbull has done a decent job of delivering relatively good performance at Tower Limited (NZSE:TWR) recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 20th of February. However, some shareholders may still be hesitant of being overly generous with CEO compensation.
Check out our latest analysis for Tower
Comparing Tower Limited's CEO Compensation With The Industry
According to our data, Tower Limited has a market capitalization of NZ$231m, and paid its CEO total annual compensation worth NZ$658k over the year to September 2023. That is, the compensation was roughly the same as last year. Notably, the salary of NZ$658k is the entirety of the CEO compensation.
For comparison, other companies in the New Zealand Insurance industry with market capitalizations below NZ$329m, reported a median total CEO compensation of NZ$362k. Hence, we can conclude that Blair Turnbull is remunerated higher than the industry median. What's more, Blair Turnbull holds NZ$166k worth of shares in the company in their own name.
Component | 2023 | 2022 | Proportion (2023) |
Salary | NZ$658k | NZ$650k | 100% |
Other | - | - | - |
Total Compensation | NZ$658k | NZ$650k | 100% |
On an industry level, around 52% of total compensation represents salary and 48% is other remuneration. Speaking on a company level, Tower prefers to tread along a traditional path, disbursing all compensation through a salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
A Look at Tower Limited's Growth Numbers
Tower Limited has reduced its earnings per share by 38% a year over the last three years. It achieved revenue growth of 16% over the last year.
The decrease in EPS could be a concern for some investors. But on the other hand, revenue growth is strong, suggesting a brighter future. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has Tower Limited Been A Good Investment?
Tower Limited has not done too badly by shareholders, with a total return of 7.1%, over three years. It would be nice to see that metric improve in the future. Accordingly, a proposal to increase CEO remuneration without seeing an improvement in shareholder returns might not be met favorably by most shareholders.
In Summary...
Tower rewards its CEO solely through a salary, ignoring non-salary benefits completely. Some shareholders will be pleased by the relatively good results, however, the results could still be improved. Until EPS growth picks back up, we think shareholders may find it hard to justify increasing CEO pay given that they are already paid above industry average.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 2 warning signs for Tower that investors should look into moving forward.
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.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.
