Does GDI Integrated Facility Services Inc.’s (TSE:GDI) CEO Pay Compare Well With Peers?

Claude Bigras became the CEO of GDI Integrated Facility Services Inc. (TSE:GDI) in 2004. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we’ll consider growth that the business demonstrates. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.

Check out our latest analysis for GDI Integrated Facility Services

How Does Claude Bigras’s Compensation Compare With Similar Sized Companies?

According to our data, GDI Integrated Facility Services Inc. has a market capitalization of CA$755m, and paid its CEO total annual compensation worth CA$2.2m over the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at CA$566k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of CA$266m to CA$1.1b. The median total CEO compensation was CA$1.3m.

Thus we can conclude that Claude Bigras receives more in total compensation than the median of a group of companies in the same market, and of similar size to GDI Integrated Facility Services Inc.. 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.

The graphic below shows how CEO compensation at GDI Integrated Facility Services has changed from year to year.

TSX:GDI CEO Compensation, February 10th 2020
TSX:GDI CEO Compensation, February 10th 2020

Is GDI Integrated Facility Services Inc. Growing?

GDI Integrated Facility Services Inc. has reduced its earnings per share by an average of 25% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is up 19%.

Sadly for shareholders, earnings per share are actually down, over three years. There’s no doubt that the silver lining is that revenue is up. But it isn’t sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. It’s hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Shareholders might be interested in this free visualization of analyst forecasts.

Has GDI Integrated Facility Services Inc. Been A Good Investment?

Most shareholders would probably be pleased with GDI Integrated Facility Services Inc. for providing a total return of 104% over three years. This strong performance might mean some shareholders don’t mind if the CEO were to be paid more than is normal for a company of its size.

In Summary…

We compared the total CEO remuneration paid by GDI Integrated Facility Services Inc., 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.

Earnings per share have not grown in three years, and the revenue growth fails to impress us. But clearly there are some positives, because investors have done well over the same time frame. Considering this, shareholders are probably not too worried about the CEO compensation. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling GDI Integrated Facility Services (free visualization of insider trades).

Important note: GDI Integrated Facility Services may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE 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.

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