Is CSR Limited (ASX:CSR) Excessively Paying Its CEO?

Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!

Rob Sindel became the CEO of CSR Limited (ASX:CSR) in 2011. 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. The aim of all this is to consider the appropriateness of CEO pay levels.

Check out our latest analysis for CSR

How Does Rob Sindel's Compensation Compare With Similar Sized Companies?

Our data indicates that CSR Limited is worth AU$2.0b, and total annual CEO compensation is AU$3.1m. (This number is for the twelve months until March 2019). That's less than last year. We think total compensation is more important but we note that the CEO salary is lower, at AU$1.3m. We looked at a group of companies with market capitalizations from AU$1.5b to AU$4.7b, and the median CEO total compensation was AU$2.4m.

So Rob Sindel is paid around the average of the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.

You can see a visual representation of the CEO compensation at CSR, below.

Is CSR Limited Growing?

CSR Limited has reduced its earnings per share by an average of 6.1% a year, over the last three years (measured with a line of best fit). Its revenue is up 3.8% over last year.

Few shareholders would be pleased to read that earnings per share are lower over three years. And the modest revenue growth over 12 months isn't much comfort against the reduced earnings per share. 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 CSR Limited Been A Good Investment?

With a total shareholder return of 32% over three years, CSR Limited shareholders would, in general, be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary...

Rob Sindel is paid around the same as most CEOs of similar size companies.

We're not seeing great strides in earnings per share, and total returns were decent but not amazing in the last three years. We're not saying the CEO pay is too generous, but we'd venture the company should look to improve its business metrics (and share price) before paying any more. Whatever your view on compensation, you might want to check if insiders are buying or selling CSR shares (free trial).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.