We Think International Consolidated Airlines Group S.A.'s (LON:IAG) CEO Compensation Looks Fair

Key Insights

• International Consolidated Airlines Group's Annual General Meeting to take place on 19th of June
• Salary of €1.05m is part of CEO Luis Gallego Martin's total remuneration
• Total compensation is similar to the industry average
• Over the past three years, International Consolidated Airlines Group's EPS grew by 82% and over the past three years, the total shareholder return was 192%

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It would be hard to discount the role that CEO Luis Gallego Martin has played in delivering the impressive results at International Consolidated Airlines Group S.A. (LON:IAG) recently. Shareholders will have this at the front of their minds in the upcoming AGM on 19th of June. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.

Check out our latest analysis for International Consolidated Airlines Group

Comparing International Consolidated Airlines Group S.A.'s CEO Compensation With The Industry

At the time of writing, our data shows that International Consolidated Airlines Group S.A. has a market capitalization of UK£16b, and reported total annual CEO compensation of €5.5m for the year to December 2024. That's a notable increase of 54% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at €1.0m.

For comparison, other companies in the the United Kingdom Airlines industry with market capitalizations above UK£5.9b, reported a median total CEO compensation of €5.5m. So it looks like International Consolidated Airlines Group compensates Luis Gallego Martin in line with the median for the industry. What's more, Luis Gallego Martin holds UK£4.6m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

On an industry level, around 31% of total compensation represents salary and 69% is other remuneration. International Consolidated Airlines Group sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

International Consolidated Airlines Group S.A.'s Growth

Over the past three years, International Consolidated Airlines Group S.A. has seen its earnings per share (EPS) grow by 82% per year. In the last year, its revenue is up 9.1%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has International Consolidated Airlines Group S.A. Been A Good Investment?

Most shareholders would probably be pleased with International Consolidated Airlines Group S.A. for providing a total return of 192% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 2 warning signs for International Consolidated Airlines Group that investors should be aware of in a dynamic business environment.

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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.