We Think Shareholders May Want To Consider A Review Of Swiss Prime Site AG's (VTX:SPSN) CEO Compensation Package

Key Insights

• Swiss Prime Site to hold its Annual General Meeting on 21st of March
• Total pay for CEO René Zahnd includes CHF750.0k salary
• Total compensation is similar to the industry average
• Swiss Prime Site's three-year loss to shareholders was 17% while its EPS was down 13% over the past three years

Shareholders will probably not be too impressed with the underwhelming results at Swiss Prime Site AG (VTX:SPSN) recently. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 21st of March. 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.

View our latest analysis for Swiss Prime Site

How Does Total Compensation For René Zahnd Compare With Other Companies In The Industry?

At the time of writing, our data shows that Swiss Prime Site AG has a market capitalization of CHF6.0b, and reported total annual CEO compensation of CHF1.6m for the year to December 2022. That's slightly lower by 5.3% over the previous year. While we always look at total compensation first, our analysis shows that the salary component is less, at CHF750k.

In comparison with other companies in the Swiss Real Estate industry with market capitalizations ranging from CHF3.7b to CHF11b, the reported median CEO total compensation was CHF1.8m. From this we gather that René Zahnd is paid around the median for CEOs in the industry. Moreover, René Zahnd also holds CHF1.3m worth of Swiss Prime Site stock directly under their own name.

Component	2022	2021	Proportion (2022)
Salary	CHF750k	CHF788k	47%
Other	CHF836k	CHF887k	53%
Total Compensation	CHF1.6m	CHF1.7m	100%

On an industry level, roughly 48% of total compensation represents salary and 52% is other remuneration. Our data reveals that Swiss Prime Site allocates salary more or less in line with the wider market. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Swiss Prime Site AG's Growth Numbers

Over the last three years, Swiss Prime Site AG has shrunk its earnings per share by 13% per year. In the last year, its revenue is up 7.8%.

Overall this is not a very positive result for shareholders. And the modest revenue growth over 12 months isn't much comfort against the reduced EPS. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Swiss Prime Site AG Been A Good Investment?

With a three year total loss of 17% for the shareholders, Swiss Prime Site AG would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

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, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 3 warning signs for Swiss Prime Site you should be aware of, and 2 of them are significant.

Important note: Swiss Prime Site 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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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.