Is Royal Boskalis Westminster N.V. (AMS:BOKA) Overpaying Its CEO?

Simply Wall St

Peter A. Berdowski became the CEO of Royal Boskalis Westminster N.V. (AMS:BOKA) in 2006. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for Royal Boskalis Westminster

How Does Peter A. Berdowski's Compensation Compare With Similar Sized Companies?

According to our data, Royal Boskalis Westminster N.V. has a market capitalization of €3.0b, and paid its CEO total annual compensation worth €1.9m over the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at €805k. When we examined a selection of companies with market caps ranging from €1.8b to €5.9b, we found the median CEO total compensation was €2.0m.

That means Peter A. Berdowski receives fairly typical remuneration for the CEO of a company that size. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see a visual representation of the CEO compensation at Royal Boskalis Westminster, below.

ENXTAM:BOKA CEO Compensation, February 18th 2020

Is Royal Boskalis Westminster N.V. Growing?

On average over the last three years, Royal Boskalis Westminster N.V. has shrunk earnings per share by 3.4% each year (measured with a line of best fit). It achieved revenue growth of 11% over the last year.

Unfortunately, earnings per share have trended lower over the last three years. While the revenue growth is good to see, it is outweighed by the fact that earnings per share 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. It could be important to check this free visual depiction of what analysts expect for the future.

Has Royal Boskalis Westminster N.V. Been A Good Investment?

Since shareholders would have lost about 27% over three years, some Royal Boskalis Westminster N.V. shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Remuneration for Peter A. Berdowski is close enough to the median pay for a CEO of a similar sized company .

The company isn't growing EPS, and shareholder returns have been disappointing. Most would consider it prudent for the company to hold off any CEO pay rise until performance improves. So you may want to check if insiders are buying Royal Boskalis Westminster shares with their own money (free access).

If you want to buy a stock that is better than Royal Boskalis Westminster, this free list of high return, low debt companies is a great place to look.

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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