Here's Why Shareholders Should Examine Leonteq AG's (VTX:LEON) CEO Compensation Package More Closely

Key Insights

• Leonteq will host its Annual General Meeting on 28th of March
• Salary of CHF977.0k is part of CEO Lukas Ruflin's total remuneration
• Total compensation is 143% above industry average
• Over the past three years, Leonteq's EPS fell by 18% and over the past three years, the total loss to shareholders 37%

Leonteq AG (VTX:LEON) has not performed well recently and CEO Lukas Ruflin will probably need to up their game. At the upcoming AGM on 28th of March, shareholders can hear from the board including their plans for turning around performance. 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. The data we present below explains why we think CEO compensation is not consistent with recent performance.

View our latest analysis for Leonteq

How Does Total Compensation For Lukas Ruflin Compare With Other Companies In The Industry?

According to our data, Leonteq AG has a market capitalization of CHF451m, and paid its CEO total annual compensation worth CHF2.2m over the year to December 2023. That's a notable decrease of 16% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at CHF977k.

On comparing similar companies from the Swiss Capital Markets industry with market caps ranging from CHF180m to CHF718m, we found that the median CEO total compensation was CHF908k. This suggests that Lukas Ruflin is paid more than the median for the industry. Furthermore, Lukas Ruflin directly owns CHF41m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	CHF977k	CHF977k	44%
Other	CHF1.2m	CHF1.6m	56%
Total Compensation	CHF2.2m	CHF2.6m	100%

On an industry level, around 45% of total compensation represents salary and 55% is other remuneration. Leonteq is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Leonteq AG's Growth

Over the last three years, Leonteq AG has shrunk its earnings per share by 18% per year. Its revenue is down 44% over the previous year.

Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Leonteq AG Been A Good Investment?

The return of -37% over three years would not have pleased Leonteq AG shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 4 warning signs for Leonteq (of which 1 shouldn't be ignored!) that you should know about in order to have a holistic understanding of the stock.

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.

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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.