Does ISS A/S’s (CPH:ISS) CEO Pay Reflect Performance?

In 2010 Jeff Gravenhorst was appointed CEO of ISS A/S (CPH:ISS). First, this article will compare CEO compensation with compensation at similar sized companies. Then we’ll look at a snap shot of the business growth. 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.

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How Does Jeff Gravenhorst’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that ISS A/S has a market cap of ø34b, and is paying total annual CEO compensation of ø19m. (This figure is for the year to 2017). While we always look at total compensation first, we note that the salary component is less, at ø9.2m. We examined companies with market caps from ø26b to ø79b, and discovered that the median CEO compensation of that group was ø15m.

So Jeff Gravenhorst 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, below, how CEO compensation at ISS has changed over time.

CPSE:ISS CEO Compensation January 18th 19
CPSE:ISS CEO Compensation January 18th 19

Is ISS A/S Growing?

ISS A/S has reduced its earnings per share by an average of 12% a year, over the last three years. In the last year, its revenue changed by just -0.3%.

Unfortunately, earnings per share have trended lower over the last three years. And the flat revenue is seriously uninspiring. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO.

You might want to check this free visual report on analyst forecasts for future earnings.

Has ISS A/S Been A Good Investment?

Since shareholders would have lost about 11% over three years, some ISS A/S shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.

In Summary…

Remuneration for Jeff Gravenhorst is close enough to the median pay for a CEO of a similar sized company .

Returns have been disappointing and the company is not growing its earnings per share. Suffice it to say, we don’t think the CEO is underpaid! If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at ISS.

Or you might prefer gaze upon this detailed graph of past earnings, revenue and cash flow .

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.