Does QL Resources Berhad's (KLSE:QL) CEO Salary Compare Well With Industry Peers?

This article will reflect on the compensation paid to Song Chia who has served as CEO of QL Resources Berhad (KLSE:QL) since 2018. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

View our latest analysis for QL Resources Berhad

Comparing QL Resources Berhad's CEO Compensation With the industry

At the time of writing, our data shows that QL Resources Berhad has a market capitalization of RM15b, and reported total annual CEO compensation of RM2.4m for the year to March 2020. Notably, that's an increase of 17% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at RM984k.

On comparing similar companies from the same industry with market caps ranging from RM8.1b to RM26b, we found that the median CEO total compensation was RM2.5m. From this we gather that Song Chia is paid around the median for CEOs in the industry. What's more, Song Chia holds RM39m 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 76% of total compensation represents salary and 24% is other remuneration. In QL Resources Berhad's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

QL Resources Berhad's Growth

QL Resources Berhad has seen its earnings per share (EPS) increase by 6.3% a year over the past three years. Its revenue is up 4.8% over the last year.

We're not particularly impressed by the revenue growth, but the modest improvement in EPS is good. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has QL Resources Berhad Been A Good Investment?

Boasting a total shareholder return of 96% over three years, QL Resources Berhad has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

As previously discussed, Song is compensated close to the median for companies of its size, and which belong to the same industry. However, the company's EPS growth numbers over the last three years is not that impressive. On the other hand, shareholder returns over the same period have been very healthy. So while shareholders shouldn't be overly concerned about CEO compensation, we suspect most would prefer to see improved performance, before a bump in pay.

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 1 warning sign for QL Resources Berhad that investors should think about before committing capital to this stock.

Important note: QL Resources Berhad is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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. 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.
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