Does OCI N.V.'s (AMS:OCI) CEO Salary Reflect Performance?

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Nassef Onssy Sawiris became the CEO of OCI N.V. (AMS:OCI) in 2013. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for OCI

How Does Nassef Onssy Sawiris's Compensation Compare With Similar Sized Companies?

Our data indicates that OCI N.V. is worth €4.2b, and total annual CEO compensation was reported as US$6.3m for the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$2.0m. 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 US$2.0b to US$6.4b, and the median CEO total compensation was US$2.4m.

Thus we can conclude that Nassef Onssy Sawiris receives more in total compensation than the median of a group of companies in the same market, and of similar size to OCI N.V.. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see, below, how CEO compensation at OCI has changed over time.

ENXTAM:OCI CEO Compensation, November 15th 2019
ENXTAM:OCI CEO Compensation, November 15th 2019

Is OCI N.V. Growing?

Over the last three years OCI N.V. has shrunk its earnings per share by an average of 46% per year (measured with a line of best fit). It achieved revenue growth of 18% over the last year.

Few shareholders would be pleased to read that earnings per share are lower over three years. While the revenue growth is good to see, it is outweighed by the fact that earnings per share are down, over three years. 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 OCI N.V. Been A Good Investment?

Boasting a total shareholder return of 53% over three years, OCI N.V. has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

We compared the total CEO remuneration paid by OCI N.V., and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.

Neither earnings per share nor revenue have been growing sufficiently to impress us, over the last three years. However, we can't argue with the strong returns to shareholders, over the same time period. Given this situation we doubt shareholders are particularly concerned about the CEO compensation. Whatever your view on compensation, you might want to check if insiders are buying or selling OCI 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.

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.

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