Youhong Ji became the CEO of China Resources Cement Holdings Limited (HKG:1313) in 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. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
How Does Youhong Ji's Compensation Compare With Similar Sized Companies?
According to our data, China Resources Cement Holdings Limited has a market capitalization of HK$59b, and pays its CEO total annual compensation worth HK$4.9m. (This number is for the twelve months until December 2018). We note that's an increase of 11% above last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at HK$1.5m. We looked at a group of companies with market capitalizations from HK$31b to HK$94b, and the median CEO total compensation was HK$3.0m.
It would therefore appear that China Resources Cement Holdings Limited pays Youhong Ji 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. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at China Resources Cement Holdings, below.
Is China Resources Cement Holdings Limited Growing?
Over the last three years China Resources Cement Holdings Limited has grown its earnings per share (EPS) by an average of 82% per year (using a line of best fit). In the last year, its revenue is up 29%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. It could be important to check this free visual depiction of what analysts expect for the future.
Has China Resources Cement Holdings Limited Been A Good Investment?
I think that the total shareholder return of 259%, over three years, would leave most China Resources Cement Holdings Limited shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
We examined the amount China Resources Cement Holdings Limited pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
However we must not forget that the EPS growth has been very strong over three years. Even better, returns to shareholders have been plentiful, over the same time period. So, considering this good performance, the CEO compensation may be quite appropriate. Whatever your view on compensation, you might want to check if insiders are buying or selling China Resources Cement Holdings shares (free trial).
If you want to buy a stock that is better than China Resources Cement Holdings, this free list of high return, low debt companies is a great place to look.
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If you spot an error that warrants correction, please contact the editor at email@example.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. Thank you for reading.