Sipef NV's (EBR:SIP) CEO Might Not Expect Shareholders To Be So Generous This Year
The results at Sipef NV (EBR:SIP) have been quite disappointing recently and CEO François Van Hoydonck bears some responsibility for this. At the upcoming AGM on 09 June 2021, shareholders can hear from the board including their plans for turning around performance. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. The data we present below explains why we think CEO compensation is not consistent with recent performance.
Check out our latest analysis for Sipef
Comparing Sipef NV's CEO Compensation With the industry
Our data indicates that Sipef NV has a market capitalization of €491m, and total annual CEO compensation was reported as US$816k for the year to December 2020. We note that's a decrease of 13% compared to last year. We note that the salary of US$452.6k makes up a sizeable portion of the total compensation received by the CEO.
For comparison, other companies in the same industry with market capitalizations ranging between €327m and €1.3b had a median total CEO compensation of US$755k. This suggests that Sipef remunerates its CEO largely in line with the industry average.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | US$453k | US$414k | 55% |
| Other | US$363k | US$529k | 45% |
| Total Compensation | US$816k | US$943k | 100% |
On an industry level, roughly 66% of total compensation represents salary and 34% is other remuneration. Sipef sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
Sipef NV's Growth
Over the last three years, Sipef NV has shrunk its earnings per share by 54% per year. Its revenue is up 10% over the last year.
The decline in EPS is a bit concerning. While the revenue growth is good to see, it is outweighed by the fact that EPS are down, over three years. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has Sipef NV Been A Good Investment?
Given the total shareholder loss of 18% over three years, many shareholders in Sipef NV are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.
Shareholders may want to check for free if Sipef insiders are buying or selling shares.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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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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About ENXTBR:SIP
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