What We Learned About Frasers Property's (SGX:TQ5) CEO Compensation

This article will reflect on the compensation paid to Panote Sirivadhanabhakdi who has served as CEO of Frasers Property Limited (SGX:TQ5) since 2016. This analysis will also assess whether Frasers Property pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for Frasers Property

Comparing Frasers Property Limited's CEO Compensation With the industry

According to our data, Frasers Property Limited has a market capitalization of S$3.5b, and paid its CEO total annual compensation worth S$3.8m over the year to September 2020. This means that the compensation hasn't changed much from last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at S$844k.

For comparison, other companies in the same industry with market capitalizations ranging between S$2.6b and S$8.5b had a median total CEO compensation of S$1.2m. Accordingly, our analysis reveals that Frasers Property Limited pays Panote Sirivadhanabhakdi north of the industry median.

On an industry level, around 58% of total compensation represents salary and 42% is other remuneration. Frasers Property pays a modest slice of remuneration through salary, as compared 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 Frasers Property Limited's Growth Numbers

Over the last three years, Frasers Property Limited has shrunk its earnings per share by 44% per year. It saw its revenue drop 5.2% over the last year.

Overall this is not a very positive result for shareholders. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Frasers Property Limited Been A Good Investment?

With a three year total loss of 34% for the shareholders, Frasers Property Limited would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

As we touched on above, Frasers Property Limited is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. This doesn't look good against shareholder returns, which have been negative for the past three years. What's equally worrying is that the company isn't growing by our analysis. Overall, with such poor performance, shareholder's would probably have questions if the company decided to give the CEO a raise.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 2 warning signs (and 1 which is potentially serious) in Frasers Property we think you should know about.

Important note: Frasers Property 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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