In 2008 George Paleologou was appointed CEO of Premium Brands Holdings Corporation (TSE:PBH). 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. 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.
How Does George Paleologou’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Premium Brands Holdings Corporation has a market cap of CA$3.7b, and is paying total annual CEO compensation of CA$2.6m. (This figure is for the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at CA$800k. We examined companies with market caps from US$2.0b to US$6.4b, and discovered that the median CEO total compensation of that group was US$2.9m.
That means George Paleologou receives fairly typical remuneration for the CEO of a company that size. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
You can see, below, how CEO compensation at Premium Brands Holdings has changed over time.
Is Premium Brands Holdings Corporation Growing?
Over the last three years Premium Brands Holdings Corporation has grown its earnings per share (EPS) by an average of 10.0% per year (using a line of best fit). It achieved revenue growth of 37% over the last year.
I like the look of the strong year-on-year improvement in revenue. And in that context, the modest EPS improvement certainly isn’t shabby. I wouldn’t say this is necessarily top notch growth, but it is certainly promising.
Has Premium Brands Holdings Corporation Been A Good Investment?
Boasting a total shareholder return of 64% over three years, Premium Brands Holdings Corporation 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.
George Paleologou is paid around what is normal the leaders of comparable size companies.
While the growth could be better, the shareholder returns are clearly good. So considering most shareholders would be happy, we’d say the CEO pay is appropriate. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Premium Brands Holdings (free visualization of insider trades).
If you want to buy a stock that is better than Premium Brands Holdings, this free list of high return, low debt companies is a great place to look.
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