Shareholders May Be Wary Of Increasing Melexis NV's (EBR:MELE) CEO Compensation Package
Key Insights
- Melexis to hold its Annual General Meeting on 13th of May
- Total pay for CEO Marc Biron includes €385.0k salary
- Total compensation is similar to the industry average
- Melexis' EPS declined by 1.9% over the past three years while total shareholder loss over the past three years was 22%
The results at Melexis NV (EBR:MELE) have been quite disappointing recently and CEO Marc Biron bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 13th of May. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. From our analysis, we think CEO compensation may need a review in light of the recent performance.
Check out our latest analysis for Melexis
How Does Total Compensation For Marc Biron Compare With Other Companies In The Industry?
Our data indicates that Melexis NV has a market capitalization of €2.1b, and total annual CEO compensation was reported as €441k for the year to December 2024. We note that's a decrease of 18% compared to last year. In particular, the salary of €385.0k, makes up a huge portion of the total compensation being paid to the CEO.
On examining similar-sized companies in the Belgium Semiconductor industry with market capitalizations between €1.8b and €5.6b, we discovered that the median CEO total compensation of that group was €368k. From this we gather that Marc Biron is paid around the median for CEOs in the industry.
| Component | 2024 | 2023 | Proportion (2024) |
| Salary | €385k | €382k | 87% |
| Other | €56k | €155k | 13% |
| Total Compensation | €441k | €537k | 100% |
Speaking on an industry level, nearly 49% of total compensation represents salary, while the remainder of 51% is other remuneration. Melexis pays out 87% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
A Look at Melexis NV's Growth Numbers
Over the last three years, Melexis NV has shrunk its earnings per share by 1.9% per year. Its revenue is down 9.0% over the previous year.
The lack of EPS growth is certainly uninspiring. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation 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 Melexis NV Been A Good Investment?
Given the total shareholder loss of 22% over three years, many shareholders in Melexis NV are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. 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.
CEO compensation can have a massive impact on performance, but it's just one element. We've identified 1 warning sign for Melexis that investors should be aware of in a dynamic business environment.
Important note: Melexis 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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