Highlights
- AGM on the 2nd of May offers a platform for shareholder engagement.
- CEO Marcus Price receives 52% above industry average compensation.
- Iress Limited (IRE) records a 24% drop in shareholder value over three years.
As Iress Limited's (ASX:IRE) Annual General Meeting (AGM) approaches on May 2nd, shareholders have much to ponder after witnessing a 24% decline in the company's share value over the past three years. Despite a commendable earnings per share (EPS) growth of 7.4% in the same period, the share price has not mirrored the company's financial performance.
The AGM presents an opportunity for shareholders to voice their concerns and potentially sway the direction of the company through their votes, especially on resolutions like executive remuneration. Currently, CEO Marcus Price's remuneration raised eyebrows, as the total compensation of AU$2.4 million stands noticeably above the median of similar entities in the Australian software industry.
CEO Compensation in Focus
Marcus Price's annual salary for 2024 is set at AU$779,000, comprising just 32% of his total AU$2.4 million compensation package, which saw a 19% year-over-year increase. This places it significantly higher than the industry standard, where CEO remuneration averages around AU$1.6 million for companies of similar market caps.
Intriguingly, non-salary components form the majority of Price's compensation, suggesting a compensation structure tied to the company's performance. However, with Iress' recent revenue decline of 3.4%, the appropriateness of such high compensation could be a topic for debate at the upcoming meeting.
Shareholder Returns and Investment Outlook
The past three years have not been kind to Iress' shareholders, with a 24% drop in shareholder value, highlighting potential issues beyond mere financial metrics that might be affecting the company. The disconnect between EPS growth and share price suggests underlying factors at play that investors may want to scrutinize.
As stakeholders converge for the AGM, there’s a chance to question the board on pressing issues and evaluate the investment's potential. CEO remuneration—while notable—is just one piece of the puzzle that influences company performance and shareholder satisfaction.