Köln Riske became the CEO of KION GROUP AG (ETR:KGX) in 2008. 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. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Köln Riske's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that KION GROUP AG has a market cap of €4.5b, and reported total annual CEO compensation of €4.5m for the year to December 2019. That's actually a decrease on the year before. While we always look at total compensation first, we note that the salary component is less, at €1.4m. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We looked at a group of companies with market capitalizations from €3.6b to €11b, and the median CEO total compensation was €3.4m.
Next, let's break down remuneration compositions to understand how the industry and company compare with each other. Talking in terms of the sector, salary represented approximately 36% of total compensation out of all the companies we analysed, while other remuneration made up 64% of the pie. So it seems like there isn't a significant difference between KION GROUP and the broader market, in terms of salary allocation in the overall compensation package.
Thus we can conclude that Köln Riske receives more in total compensation than the median of a group of companies in the same market, and of similar size to KION GROUP AG. 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 KION GROUP has changed from year to year.
Is KION GROUP AG Growing?
KION GROUP AG has seen earnings per share (EPS) move positively by an average of 16% a year, over the last three years (using a line of best fit). It achieved revenue growth of 10% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. It could be important to check this free visual depiction of what analysts expect for the future.
Has KION GROUP AG Been A Good Investment?
With a three year total loss of 34%, KION GROUP AG would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
We compared total CEO remuneration at KION GROUP AG with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.
However we must not forget that the EPS growth has been very strong over three years. On the other hand returns to investors over the same period have probably disappointed many. Considering positive per-share earnings movement, but keeping in mind the weak returns, we'd need more time to form a view on CEO compensation. Shifting gears from CEO pay for a second, we've picked out 3 warning signs for KION GROUP that investors should be aware of in a dynamic business environment.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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