We Discuss Whether Jerónimo Martins, SGPS, S.A.'s (ELI:JMT) CEO Is Due For A Pay Rise

Key Insights

• Jerónimo Martins SGPS to hold its Annual General Meeting on 18th of April
• Salary of €490.0k is part of CEO Pedro de Castro Soares dos Santos's total remuneration
• The overall pay is 71% below the industry average
• Jerónimo Martins SGPS' total shareholder return over the past three years was 42% while its EPS grew by 34% over the past three years

The impressive results at Jerónimo Martins, SGPS, S.A. (ELI:JMT) recently will be great news for shareholders. At the upcoming AGM on 18th of April, they would be interested to hear about the company strategy going forward and get a chance to cast their votes on resolutions such as executive remuneration and other company matters. Let's take a look at why we think the CEO has done a good job and we'll present the case for a bump in pay.

View our latest analysis for Jerónimo Martins SGPS

Comparing Jerónimo Martins, SGPS, S.A.'s CEO Compensation With The Industry

According to our data, Jerónimo Martins, SGPS, S.A. has a market capitalization of €12b, and paid its CEO total annual compensation worth €2.4m over the year to December 2023. That's a notable increase of 32% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at €490k.

For comparison, other companies in the Portugal Consumer Retailing industry with market capitalizations above €7.5b, reported a median total CEO compensation of €8.0m. In other words, Jerónimo Martins SGPS pays its CEO lower than the industry median. Moreover, Pedro de Castro Soares dos Santos also holds €5.1m worth of Jerónimo Martins SGPS stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	€490k	€406k	21%
Other	€1.9m	€1.4m	79%
Total Compensation	€2.4m	€1.8m	100%

Speaking on an industry level, nearly 41% of total compensation represents salary, while the remainder of 59% is other remuneration. Jerónimo Martins SGPS pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Jerónimo Martins, SGPS, S.A.'s Growth

Jerónimo Martins, SGPS, S.A.'s earnings per share (EPS) grew 34% per year over the last three years. Its revenue is up 21% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. 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 Jerónimo Martins, SGPS, S.A. Been A Good Investment?

We think that the total shareholder return of 42%, over three years, would leave most Jerónimo Martins, SGPS, S.A. shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. However, investors will get the chance to engage on key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Jerónimo Martins SGPS that investors should think about before committing capital to this stock.

Important note: Jerónimo Martins SGPS 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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.