How Much Is Meritz Fire & Marine Insurance Co., Ltd. (KRX:000060) Paying Its CEO?

Yong Bum Kim has been the CEO of Meritz Fire & Marine Insurance Co., Ltd. (KRX:000060) since 2015, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

See our latest analysis for Meritz Fire & Marine Insurance

Comparing Meritz Fire & Marine Insurance Co., Ltd.'s CEO Compensation With the industry

At the time of writing, our data shows that Meritz Fire & Marine Insurance Co., Ltd. has a market capitalization of ₩1.5t, and reported total annual CEO compensation of ₩1.5b for the year to December 2019. That's mostly flat as compared to the prior year's compensation. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at ₩719m.

For comparison, other companies in the same industry with market capitalizations ranging between ₩1.1t and ₩3.7t had a median total CEO compensation of ₩2.5b. Accordingly, Meritz Fire & Marine Insurance pays its CEO under the industry median. Furthermore, Yong Bum Kim directly owns ₩2.7b worth of shares in the company, implying that they are deeply invested in the company's success.

Talking in terms of the industry, salary represented approximately 63% of total compensation out of all the companies we analyzed, while other remuneration made up 37% of the pie. It's interesting to note that Meritz Fire & Marine Insurance allocates a smaller portion of compensation to salary in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Meritz Fire & Marine Insurance Co., Ltd.'s Growth Numbers

Meritz Fire & Marine Insurance Co., Ltd. has reduced its earnings per share by 1.6% a year over the last three years. In the last year, its revenue is up 14%.

A lack of EPS improvement is not good to see. While the revenue growth is good to see, it is outweighed by the fact that EPS are down, over three years. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Meritz Fire & Marine Insurance Co., Ltd. Been A Good Investment?

With a three year total loss of 40% for the shareholders, Meritz Fire & Marine Insurance Co., Ltd. would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

As we noted earlier, Meritz Fire & Marine Insurance pays its CEO lower than the norm for similar-sized companies belonging to the same industry. EPS growth has failed to impress us, and the same can be said about shareholder returns. Although we wouldn’t say CEO compensation is high, it’s tough to foresee shareholders warming up to thoughts of a bump anytime soon.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 2 warning signs for Meritz Fire & Marine Insurance that you should be aware of before investing.

Switching gears from Meritz Fire & Marine Insurance, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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