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Jie Han became the CEO of China XD Plastics Company Limited (NASDAQ:CXDC) in 2008. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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. This method should give us information to assess how appropriately the company pays the CEO.
How Does Jie Han's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that China XD Plastics Company Limited has a market cap of US$95m, and reported total annual CEO compensation of US$544k for the year to December 2018. Notably, the salary of US$544k is the vast majority of the CEO compensation. We looked at a group of companies with market capitalizations under US$200m, and the median CEO total compensation was US$522k.
So Jie Han receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at China XD Plastics has changed over time.
Is China XD Plastics Company Limited Growing?
Over the last three years China XD Plastics Company Limited has shrunk its earnings per share by an average of 18% per year (measured with a line of best fit). In the last year, its revenue is up 10.0%.
Unfortunately, earnings per share have trended lower over the last three years. And the modest revenue growth over 12 months isn't much comfort against the reduced earnings per share. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Although we don't have analyst forecasts shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has China XD Plastics Company Limited Been A Good Investment?
With a three year total loss of 70%, China XD Plastics Company Limited would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
Jie Han is paid around what is normal the leaders of comparable size companies.
Returns have been disappointing and the company is not growing its earnings per share. Most would consider it prudent for the company to hold off any CEO pay rise until performance improves. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at China XD Plastics.
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.
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.
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