Volkert Klaucke has been the CEO of Arundel AG (VTX:ARON) since 2016, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Arundel.
View our latest analysis for Arundel
Comparing Arundel AG's CEO Compensation With the industry
Our data indicates that Arundel AG has a market capitalization of CHF36m, and total annual CEO compensation was reported as CHF155k for the year to December 2019. That's a modest increase of 3.2% on the prior year. We note that the salary portion, which stands at US$123.2k constitutes the majority of total compensation received by the CEO.
For comparison, other companies in the industry with market capitalizations below CHF177m, reported a median total CEO compensation of CHF329k. That is to say, Volkert Klaucke is paid under the industry median. What's more, Volkert Klaucke holds CHF93k worth of shares in the company in their own name.
| Component | 2019 | 2018 | Proportion (2019) |
| Salary | CHF123k | CHF119k | 79% |
| Other | CHF32k | CHF31k | 21% |
| Total Compensation | CHF155k | CHF151k | 100% |
On an industry level, around 55% of total compensation represents salary and 45% is other remuneration. According to our research, Arundel has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Arundel AG's Growth
Arundel AG has seen its earnings per share (EPS) increase by 69% a year over the past three years. Its revenue is down 2.8% 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. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Arundel AG Been A Good Investment?
With a three year total loss of 64% for the shareholders, Arundel AG would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
As we touched on above, Arundel AG is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. However, the EPS growth over three years is certainly impressive. Although we would've liked to see positive investor returns, it would be bold of us to criticize CEO compensation when EPS are up. But we believe shareholders would want to see healthier returns before the CEO gets a raise.
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. We did our research and spotted 1 warning sign for Arundel that investors should look into moving forward.
Switching gears from Arundel, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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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 SWX:ARON
Medium-low and slightly overvalued.
