Is Bunzl plc’s (LON:BNZL) CEO Salary Justified?

Frank van Zanten has been the CEO of Bunzl plc (LON:BNZL) since 2016. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we’ll consider growth that the business demonstrates. 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.

See our latest analysis for Bunzl

How Does Frank van Zanten’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Bunzl plc has a market cap of UK£7.0b, and is paying total annual CEO compensation of UK£2.8m. (This figure is for the year to December 2018). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at UK£836k. When we examined a selection of companies with market caps ranging from UK£3.3b to UK£9.9b, we found the median CEO total compensation was UK£2.8m.

So Frank van Zanten receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn’t particularly informative alone, it gains more meaning when considered with business performance.

You can see, below, how CEO compensation at Bunzl has changed over time.

LSE:BNZL CEO Compensation, August 14th 2019
LSE:BNZL CEO Compensation, August 14th 2019

Is Bunzl plc Growing?

Bunzl plc has increased its earnings per share (EPS) by an average of 13% a year, over the last three years (using a line of best fit). It achieved revenue growth of 5.8% over the last year.

This demonstrates that the company has been improving recently. A good result. It’s good to see a bit of revenue growth, as this suggests the business is able to grow sustainably.

Has Bunzl plc Been A Good Investment?

Given the total loss of 7.8% over three years, many shareholders in Bunzl plc are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary…

Remuneration for Frank van Zanten is close enough to the median pay for a CEO of a similar sized company .

We’d say the company can boast of its EPS growth, but it’s disappointing to see negative shareholder returns over three years. Considering the the positives we don’t think the CEO pays is too high, but it’s certainly hard to argue it is too low. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Bunzl (free visualization of insider trades).

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.