Is KBC Group NV's (EBR:KBC) CEO Overpaid Relative To Its Peers?
Johan Thijs became the CEO of KBC Group NV (EBR:KBC) in 2012. First, this article will compare CEO compensation with compensation at other large companies. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
View our latest analysis for KBC Group
How Does Johan Thijs's Compensation Compare With Similar Sized Companies?
Our data indicates that KBC Group NV is worth €28b, and total annual CEO compensation was reported as €2.3m for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at €1.2m. We took a group of companies with market capitalizations over €7.2b, and calculated the median CEO total compensation to be €2.3m. There aren't very many mega-cap companies, so we had to take a wide range to get a meaningful comparison figure.
So Johan Thijs receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.
The graphic below shows how CEO compensation at KBC Group has changed from year to year.
Is KBC Group NV Growing?
On average over the last three years, KBC Group NV has grown earnings per share (EPS) by 2.0% each year (using a line of best fit). In the last year, its revenue is down 4.5%.
I would argue that the lack of revenue growth in the last year is less than ideal, but I'm happy with the EPS growth. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. It could be important to check this free visual depiction of what analysts expect for the future.
Has KBC Group NV Been A Good Investment?
With a total shareholder return of 23% over three years, KBC Group NV shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary...
Johan Thijs is paid around what is normal the leaders of larger companies.
We think many would like to see better growth. But we don't think the CEO compensation is a problem. Whatever your view on compensation, you might want to check if insiders are buying or selling KBC Group shares (free trial).
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 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.
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.
