Here’s What We Think About International Flavors & Fragrances Inc.’s (NYSE:IFF) CEO Pay
Andreas Fibig became the CEO of International Flavors & Fragrances Inc. (NYSE:IFF) in 2014. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. After that, we will consider the growth in the business. 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.
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How Does Andreas Fibig’s Compensation Compare With Similar Sized Companies?
According to our data, International Flavors & Fragrances Inc. has a market capitalization of US$15b, and pays its CEO total annual compensation worth US$7.7m. (This is based on the year to 2017). While we always look at total compensation first, we note that the salary component is less, at US$1.3m. We looked at a group of companies with market capitalizations over US$8.0b and the median CEO compensation was US$11m. There aren’t very many mega-cap companies, so we had to take a wide range to get a meaningful comparison figure.
So Andreas Fibig is paid around the average of the companies we looked at. Although this fact alone doesn’t tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at International Flavors & Fragrances has changed over time.
Is International Flavors & Fragrances Inc. Growing?
International Flavors & Fragrances Inc. has reduced its earnings per share by an average of 12% a year, over the last three years. It achieved revenue growth of 9.3% over the last year.
Few shareholders would be pleased to read that earnings per share are lower over three years. And the modest revenue growth over 12 months isn’t much comfort against the reduced earnings per share. It’s hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration.
It could be important to check this free visual depiction of what analysts expect for the future.
Has International Flavors & Fragrances Inc. Been A Good Investment?
International Flavors & Fragrances Inc. has served shareholders reasonably well, with a total return of 23% over three years. But they probably wouldn’t be so happy as to think the CEO should be paid more than is normal, for companies around this size.
In Summary…
Andreas Fibig is paid around the same as most CEOs of large companies.
We feel that earnings per share have been a bit disappointing, but and we don’t think the total returns are amazing. We wouldn’t say the CEO pay is too high, but one might argue that the company should improve returns to shareholders before increasing it. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at International Flavors & Fragrances.
Or you could feast your eyes on this interactive graph depicting past earnings, cash flow and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
