Should Shareholders Reconsider Ascom Holding AG's (VTX:ASCN) CEO Compensation Package?

Key Insights

• Ascom Holding to hold its Annual General Meeting on 16th of April
• Total pay for CEO Nicolas Van den Abeele includes CHF517.7k salary
• The overall pay is 310% above the industry average
• Ascom Holding's EPS declined by 35% over the past three years while total shareholder loss over the past three years was 66%

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Shareholders will probably not be too impressed with the underwhelming results at Ascom Holding AG (VTX:ASCN) recently. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 16th of April. 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 Ascom Holding

Comparing Ascom Holding AG's CEO Compensation With The Industry

According to our data, Ascom Holding AG has a market capitalization of CHF109m, and paid its CEO total annual compensation worth CHF1.0m over the year to December 2024. That's slightly lower by 4.9% over the previous year. We note that the salary of CHF517.7k makes up a sizeable portion of the total compensation received by the CEO.

In comparison with other companies in the Switzerland Healthcare Services industry with market capitalizations under CHF171m, the reported median total CEO compensation was CHF248k. Hence, we can conclude that Nicolas Van den Abeele is remunerated higher than the industry median. What's more, Nicolas Van den Abeele holds CHF121k worth of shares in the company in their own name.

Component	2024	2023	Proportion (2024)
Salary	CHF518k	CHF508k	51%
Other	CHF498k	CHF560k	49%
Total Compensation	CHF1.0m	CHF1.1m	100%

On an industry level, roughly 69% of total compensation represents salary and 31% is other remuneration. Ascom Holding 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.

A Look at Ascom Holding AG's Growth Numbers

Over the last three years, Ascom Holding AG has shrunk its earnings per share by 35% per year. Its revenue is down 3.6% over the previous year.

The decline in EPS is a bit concerning. And the fact that revenue is down year on year arguably paints an ugly picture. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Ascom Holding AG Been A Good Investment?

Few Ascom Holding AG shareholders would feel satisfied with the return of -66% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

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, the board will get the chance to explain the steps it plans to take to improve business performance.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 3 warning signs for Ascom Holding that you should be aware of before investing.

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. 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.