Shareholders Will Probably Hold Off On Increasing Evolva Holding SA's (VTX:EVE) CEO Compensation For The Time Being

The underwhelming share price performance of Evolva Holding SA (VTX:EVE) in the past three years would have disappointed many shareholders. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 08 April 2021. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

Check out our latest analysis for Evolva Holding

How Does Total Compensation For Oliver Walker Compare With Other Companies In The Industry?

According to our data, Evolva Holding SA has a market capitalization of CHF186m, and paid its CEO total annual compensation worth CHF933k over the year to December 2020. That is, the compensation was roughly the same as last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at CHF459k.

On comparing similar companies from the same industry with market caps ranging from CHF94m to CHF376m, we found that the median CEO total compensation was CHF610k. This suggests that Oliver Walker is paid more than the median for the industry. What's more, Oliver Walker holds CHF90k worth of shares in the company in their own name.

Component	2020	2019	Proportion (2020)
Salary	CHF459k	CHF455k	49%
Other	CHF474k	CHF460k	51%
Total Compensation	CHF933k	CHF914k	100%

Talking in terms of the industry, salary represented approximately 55% of total compensation out of all the companies we analyzed, while other remuneration made up 45% of the pie. It's interesting to note that Evolva Holding allocates a smaller portion of compensation to salary in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Evolva Holding SA's Growth

Evolva Holding SA's earnings per share (EPS) grew 25% per year over the last three years. Its revenue is down 35% over the previous year.

This demonstrates that the company has been improving recently and is good news for the shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. 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 Evolva Holding SA Been A Good Investment?

With a three year total loss of 19% for the shareholders, Evolva Holding SA would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. Shareholders would be keen to know what's holding the stock back when earnings have grown. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 2 warning signs for Evolva Holding that investors should look into moving forward.

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. 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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