Is Beijing Capital International Airport Company Limited (HKG:694) Excessively Paying Its CEO?
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Zhiliang Han has been the CEO of Beijing Capital International Airport Company Limited (HKG:694) since 2016. First, this article will compare CEO compensation with compensation at similar sized companies. Then we’ll look at a snap shot of the business growth. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
See our latest analysis for Beijing Capital International Airport
How Does Zhiliang Han’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Beijing Capital International Airport Company Limited has a market cap of HK$32b, and is paying total annual CEO compensation of CN¥905k. (This is based on the year to 2017). While we always look at total compensation first, we note that the salary component is less, at CN¥327k. When we examined a selection of companies with market caps ranging from CN¥14b to CN¥43b, we found the median CEO compensation was CN¥3.7m.
Most shareholders would consider it a positive that Zhiliang Han takes less compensation than the CEOs of most similar size companies, leaving more for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see, below, how CEO compensation at Beijing Capital International Airport has changed over time.
Is Beijing Capital International Airport Company Limited Growing?
Beijing Capital International Airport Company Limited has increased its earnings per share (EPS) by an average of 22% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 13%.
This shows that the company has improved itself over the last few years. Good news for shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. It could be important to check this free visual depiction of what analysts expect for the future.
Has Beijing Capital International Airport Company Limited Been A Good Investment?
With a total shareholder return of 19% over three years, Beijing Capital International Airport Company Limited shareholders would, in general, be reasonably content. But they probably don’t want to see the CEO paid more than is normal for companies around the same size.
In Summary…
It looks like Beijing Capital International Airport Company Limited pays its CEO less than similar sized companies. Many would consider this to indicate that the pay is modest since the business is growing. The total shareholder return might not be amazing, but that doesn’t mean that Zhiliang Han is paid too much.
It’s good to see reasonable payment of the CEO, even while the business improves. But it would be nice if insiders were also buying shares. Whatever your view on compensation, you might want to check if insiders are buying or selling Beijing Capital International Airport shares (free trial).
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
