Yahoo Finance Is PZ Cussons Plc’s (LON:PZC) CEO Pay Justified?
In 2006 G. Kanellis was appointed CEO of PZ Cussons Plc (LON:PZC). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we’ll consider growth that the business demonstrates. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
Check out our latest analysis for PZ Cussons
How Does G. Kanellis’s Compensation Compare With Similar Sized Companies?
According to our data, PZ Cussons Plc has a market capitalization of UK£886m, and pays its CEO total annual compensation worth UK£1.6m. (This figure is for the year to 2017). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at UK£578k. We examined companies with market caps from UK£315m to UK£1.3b, and discovered that the median CEO compensation of that group was UK£996k.
It would therefore appear that PZ Cussons Plc pays G. Kanellis 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 PZ Cussons, below.
Is PZ Cussons Plc Growing?
Over the last three years PZ Cussons Plc has grown its earnings per share (EPS) by an average of 1.5% per year (using a line of best fit). Its revenue is down -5.8% over last year.
I generally like to see a little revenue growth, but it is good to see EPS growth. These two metric are moving in different directions, so while it’s hard to be confident judging performance, we think the stock is worth watching.
You might want to check this free visual report on analyst forecasts for future earnings.
Has PZ Cussons Plc Been A Good Investment?
Since shareholders would have lost about 13% over three years, some PZ Cussons Plc shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary…
We compared total CEO remuneration at PZ Cussons Plc with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.
The growth in the business has been uninspiring, but the shareholder returns have arguably been worse, over the last three years. Considering this, we have the opinion that the CEO pay is more on the generous side, than the modest side. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling PZ Cussons (free visualization of insider trades).
Of course, the past can be informative so you might be interested in considering this analytical visualization showing the company history of earnings and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
