We Think Shareholders May Want To Consider A Review Of United Company RUSAL, International Public Joint-Stock Company's (HKG:486) CEO Compensation Package

Key Insights

• United Company RUSAL International to hold its Annual General Meeting on 27th of June
• Salary of US$1.79m is part of CEO Evgenii Nikitin's total remuneration
• The total compensation is 1,534% higher than the average for the industry
• United Company RUSAL International's EPS declined by 28% over the past three years while total shareholder loss over the past three years was 58%

Shareholders will probably not be too impressed with the underwhelming results at United Company RUSAL, International Public Joint-Stock Company (HKG:486) recently. At the upcoming AGM on 27th of June, shareholders can hear from the board including their plans for turning around performance. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. The data we present below explains why we think CEO compensation is not consistent with recent performance.

View our latest analysis for United Company RUSAL International

Comparing United Company RUSAL, International Public Joint-Stock Company's CEO Compensation With The Industry

Our data indicates that United Company RUSAL, International Public Joint-Stock Company has a market capitalization of HK$36b, and total annual CEO compensation was reported as US$3.1m for the year to December 2023. That's a modest increase of 4.4% on the prior year. In particular, the salary of US$1.79m, makes up a fairly large portion of the total compensation being paid to the CEO.

On examining similar-sized companies in the Hong Kong Metals and Mining industry with market capitalizations between HK$16b and HK$50b, we discovered that the median CEO total compensation of that group was US$189k. This suggests that Evgenii Nikitin is paid more than the median for the industry.

Component	2023	2022	Proportion (2023)
Salary	US$1.8m	US$1.7m	58%
Other	US$1.3m	US$1.3m	42%
Total Compensation	US$3.1m	US$3.0m	100%

On an industry level, around 86% of total compensation represents salary and 14% is other remuneration. United Company RUSAL International sets aside a smaller share of compensation for salary, in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

United Company RUSAL, International Public Joint-Stock Company's Growth

Over the last three years, United Company RUSAL, International Public Joint-Stock Company has shrunk its earnings per share by 28% per year. It saw its revenue drop 13% over the last year.

Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has United Company RUSAL, International Public Joint-Stock Company Been A Good Investment?

The return of -58% over three years would not have pleased United Company RUSAL, International Public Joint-Stock Company shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We did our research and identified 3 warning signs (and 1 which shouldn't be ignored) in United Company RUSAL International we think you should know about.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com