How Much Does Xebec Adsorption's (CVE:XBC) CEO Make?

August 11, 2020

This article will reflect on the compensation paid to Kurt Sorschak who has served as CEO of Xebec Adsorption Inc. (CVE:XBC) since 2009. This analysis will also assess whether Xebec Adsorption pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for Xebec Adsorption

Comparing Xebec Adsorption Inc.'s CEO Compensation With the industry

According to our data, Xebec Adsorption Inc. has a market capitalization of CA$458m, and paid its CEO total annual compensation worth CA$526k over the year to December 2019. That is, the compensation was roughly the same as last year. Notably, the salary which is CA$436.5k, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations ranging from CA$267m to CA$1.1b, the reported median CEO total compensation was CA$2.4m. In other words, Xebec Adsorption pays its CEO lower than the industry median. What's more, Kurt Sorschak holds CA$37m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2019	2018	Proportion (2019)
Salary	CA$437k	CA$428k	83%
Other	CA$90k	CA$99k	17%
Total Compensation	CA$526k	CA$527k	100%

Speaking on an industry level, nearly 60% of total compensation represents salary, while the remainder of 40% is other remuneration. It's interesting to note that Xebec Adsorption pays out a greater portion of remuneration through salary, compared to the industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

ceo-compensation — TSXV:XBC CEO Compensation August 11th 2020

A Look at Xebec Adsorption Inc.'s Growth Numbers

Xebec Adsorption Inc. has seen its earnings per share (EPS) increase by 29% a year over the past three years. It achieved revenue growth of 93% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Xebec Adsorption Inc. Been A Good Investment?

Boasting a total shareholder return of 940% over three years, Xebec Adsorption Inc. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

As we noted earlier, Xebec Adsorption pays its CEO lower than the norm for similar-sized companies belonging to the same industry. When taking into account the company's strong earnings growth over the past three years, it appears CEO compensation is modest. And given most shareholders are probably very happy with recent shareholder returns, they might even think Kurt deserves a raise!

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 4 warning signs for Xebec Adsorption (of which 1 makes us a bit uncomfortable!) that you should know about in order to have a holistic understanding of the stock.

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.

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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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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About TSX:XBC

Xebec Adsorption

Designs, manufactures, and sells purification, separation, dehydration, and filtration equipment for gases and compressed air in Canada, the United States, China, Korea, Italy, France, and internationally.

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