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What Did CSL's (ASX:CSL) CEO Take Home Last Year?

Simply Wall St
·3 min read

This article will reflect on the compensation paid to Paul Perreault who has served as CEO of CSL Limited (ASX:CSL) since 2013. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for CSL.

Check out our latest analysis for CSL

Comparing CSL Limited's CEO Compensation With the industry

Our data indicates that CSL Limited has a market capitalization of AU$133b, and total annual CEO compensation was reported as US$11m for the year to June 2020. This means that the compensation hasn't changed much from last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.7m.

On comparing similar companies in the industry with market capitalizations above AU$11b, we found that the median total CEO compensation was US$15m. This suggests that CSL remunerates its CEO largely in line with the industry average. Moreover, Paul Perreault also holds AU$47m worth of CSL stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component

2020

2019

Proportion (2020)

Salary

US$1.7m

US$1.7m

15%

Other

US$9.4m

US$9.1m

85%

Total Compensation

US$11m

US$11m

100%

On an industry level, around 65% of total compensation represents salary and 35% is other remuneration. In CSL's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

ceo-compensation
ceo-compensation

A Look at CSL Limited's Growth Numbers

Over the past three years, CSL Limited has seen its earnings per share (EPS) grow by 16% per year. In the last year, its revenue is up 7.1%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has CSL Limited Been A Good Investment?

Boasting a total shareholder return of 111% over three years, CSL Limited has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

As we touched on above, CSL Limited is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Few would be critical of the leadership, since returns have been juicy and EPS are moving in the right direction. Indeed, many might consider that Paul is compensated rather modestly, given the solid company performance! In fact, shareholders might even think the CEO deserves a raise as a reward due to the fantastic returns generated.

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 CSL that investors should look into moving forward.

Important note: CSL is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.