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Does Maanshan Iron Steel Company Limited's (HKG:323) CEO Pay Reflect Performance?

Simply Wall St

In 2011 Haifan Qian was appointed CEO of Maanshan Iron & Steel Company Limited (HKG:323). 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. The aim of all this is to consider the appropriateness of CEO pay levels.

Check out our latest analysis for Maanshan Iron & Steel

How Does Haifan Qian's Compensation Compare With Similar Sized Companies?

Our data indicates that Maanshan Iron & Steel Company Limited is worth HK$22b, and total annual CEO compensation was reported as CN¥821k for the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at CN¥240k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of CN¥14b to CN¥45b. The median total CEO compensation was CN¥3.7m.

A first glance this seems like a real positive for shareholders, since Haifan Qian is paid less than the average total compensation paid by similar sized companies. Though positive, it's important we delve into the performance of the actual business.

You can see, below, how CEO compensation at Maanshan Iron & Steel has changed over time.

SEHK:323 CEO Compensation, November 14th 2019

Is Maanshan Iron & Steel Company Limited Growing?

Maanshan Iron & Steel Company Limited has increased its earnings per share (EPS) by an average of 36% a year, over the last three years (using a line of best fit). Its revenue is down 8.5% over last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. It could be important to check this free visual depiction of what analysts expect for the future.

Has Maanshan Iron & Steel Company Limited Been A Good Investment?

Most shareholders would probably be pleased with Maanshan Iron & Steel Company Limited for providing a total return of 77% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

It appears that Maanshan Iron & Steel Company Limited remunerates its CEO below most similar sized companies.

Many would consider this to indicate that the pay is modest since the business is growing. The strong history of shareholder returns might even have some thinking that Haifan Qian deserves a raise! Most shareholders like to see a modestly paid CEO combined with strong performance by the company. It would be even more positive if company insiders are buying shares. Shareholders may want to check for free if Maanshan Iron & Steel insiders are buying or selling shares.

If you want to buy a stock that is better than Maanshan Iron & Steel, 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 editorial-team@simplywallst.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.