Shareholders Will Most Likely Find Elma Electronic AG's (VTX:ELMN) CEO Compensation Acceptable

Key Insights

• Elma Electronic's Annual General Meeting to take place on 24th of April
• Total pay for CEO Thomas Herrmann includes CHF362.5k salary
• The overall pay is comparable to the industry average
• Elma Electronic's total shareholder return over the past three years was 43% while its EPS grew by 4.1% over the past three years

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Performance at Elma Electronic AG (VTX:ELMN) has been reasonably good and CEO Thomas Herrmann has done a decent job of steering the company in the right direction. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 24th of April. We present our case of why we think CEO compensation looks fair.

Check out our latest analysis for Elma Electronic

How Does Total Compensation For Thomas Herrmann Compare With Other Companies In The Industry?

According to our data, Elma Electronic AG has a market capitalization of CHF251m, and paid its CEO total annual compensation worth CHF623k over the year to December 2024. We note that's an increase of 13% above last year. We note that the salary of CHF362.5k makes up a sizeable portion of the total compensation received by the CEO.

On comparing similar companies from the Swiss Electronic industry with market caps ranging from CHF164m to CHF655m, we found that the median CEO total compensation was CHF549k. So it looks like Elma Electronic compensates Thomas Herrmann in line with the median for the industry.

Component	2024	2023	Proportion (2024)
Salary	CHF363k	CHF340k	58%
Other	CHF261k	CHF212k	42%
Total Compensation	CHF623k	CHF552k	100%

Talking in terms of the industry, salary represented approximately 40% of total compensation out of all the companies we analyzed, while other remuneration made up 60% of the pie. According to our research, Elma Electronic has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Elma Electronic AG's Growth

Elma Electronic AG has seen its earnings per share (EPS) increase by 4.1% a year over the past three years. In the last year, its revenue is up 6.4%.

We'd prefer higher revenue growth, but it is good to see modest EPS growth. So there are some positives here, but not enough to earn high praise. 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 Elma Electronic AG Been A Good Investment?

Boasting a total shareholder return of 43% over three years, Elma Electronic AG has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.

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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.