Is Jutal Offshore Oil Services Limited's (HKG:3303) CEO Paid Enough Relative To Peers?
Yunsheng Cao is the CEO of Jutal Offshore Oil Services Limited (HKG:3303). First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
Check out our latest analysis for Jutal Offshore Oil Services
How Does Yunsheng Cao's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Jutal Offshore Oil Services Limited has a market cap of HK$1.2b, and reported total annual CEO compensation of CN¥6.4m for the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at CN¥1.1m. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We examined companies with market caps from CN¥696m to CN¥2.8b, and discovered that the median CEO total compensation of that group was CN¥2.0m.
Thus we can conclude that Yunsheng Cao receives more in total compensation than the median of a group of companies in the same market, and of similar size to Jutal Offshore Oil Services Limited. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see, below, how CEO compensation at Jutal Offshore Oil Services has changed over time.
Is Jutal Offshore Oil Services Limited Growing?
On average over the last three years, Jutal Offshore Oil Services Limited has grown earnings per share (EPS) by 6.4% each year (using a line of best fit). Its revenue is up 1.3% over last year.
I would argue that the improvement in revenue isn't particularly impressive, but it is good to see modest EPS growth. Considering these factors I'd say performance has been pretty decent, though not amazing. 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 Jutal Offshore Oil Services Limited Been A Good Investment?
Given the total loss of 10% over three years, many shareholders in Jutal Offshore Oil Services Limited are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
In Summary...
We compared total CEO remuneration at Jutal Offshore Oil Services Limited with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.
Over the last three years, shareholder returns have been downright disappointing, and the underlying business has failed to impress us. Shareholders may wish to consider further research. Although we don't think the CEO pay is too high, it is probably more on the generous side of things. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Jutal Offshore Oil Services (free visualization of insider trades).
Important note: Jutal Offshore Oil Services may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.
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