Peter Oswald became the CEO of Mondi plc (LON:MNDI) in 2017. This analysis aims first to contrast CEO compensation with other large companies. 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. This method should give us information to assess how appropriately the company pays the CEO.
How Does Peter Oswald's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Mondi plc has a market cap of UK£7.8b, and reported total annual CEO compensation of €5.8m for the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at €1.1m. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We looked at a group of companies with market capitalizations over €7.2b and the median CEO total compensation was €4.0m. (We took a wide range because the CEOs of massive companies tend to be paid similar amounts - even though some are quite a bit bigger than others).
Thus we can conclude that Peter Oswald receives more in total compensation than the median of a group of large companies in the same market as Mondi plc. However, this doesn't necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Mondi has changed from year to year.
Is Mondi plc Growing?
Mondi plc has increased its earnings per share (EPS) by an average of 12% a year, over the last three years (using a line of best fit). It achieved revenue growth of 3.9% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's also good to see modest revenue growth, suggesting the underlying business is healthy. You might want to check this free visual report on analyst forecasts for future earnings.
Has Mondi plc Been A Good Investment?
Mondi plc has generated a total shareholder return of 5.0% over three years, so most shareholders wouldn't be too disappointed. But they would probably prefer not to see CEO compensation far in excess of the median.
We compared the total CEO remuneration paid by Mondi plc, and compared it to remuneration at a group of other large 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. Looking at the same time period, we think that the shareholder returns are respectable. So, considering the EPS growth we do not wish to criticize the level of CEO compensation, though we'd recommend further research on management. So you may want to check if insiders are buying Mondi shares with their own money (free access).
If you want to buy a stock that is better than Mondi, this free list of high return, low debt companies is a great place to look.
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.
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. Thank you for reading.