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Niel Pretorius has been the CEO of DRDGOLD Limited (NYSE:DRD) since 2009. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Niel Pretorius's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that DRDGOLD Limited has a market cap of US$120m, and is paying total annual CEO compensation of SAR11m. (This is based on the year to June 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at SAR6.1m. We examined a group of similar sized companies, with market capitalizations of below SAR3.0b. The median CEO total compensation in that group is SAR6.7m.
It would therefore appear that DRDGOLD Limited pays Niel Pretorius 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 DRDGOLD, below.
Is DRDGOLD Limited Growing?
On average over the last three years, DRDGOLD Limited has shrunk earnings per share by 81% each year (measured with a line of best fit). Its revenue is up 3.4% over last year.
Unfortunately, earnings per share have trended lower over the last three years. The fairly low revenue growth fails to impress given that the earnings per share is down. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. You might want to check this free visual report on analyst forecasts for future earnings.
Has DRDGOLD Limited Been A Good Investment?
With a three year total loss of 60%, DRDGOLD Limited would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
We compared the total CEO remuneration paid by DRDGOLD Limited, and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.
Over the same period, investors would have come away with nothing in the way of share price gains. Some might well form the view that the CEO is paid too generously! Shareholders may want to check for free if DRDGOLD insiders are buying or selling shares.
If you want to buy a stock that is better than DRDGOLD, this free list of high return, low debt companies is a great place to look.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.