We Think bet-at-home.com AG's (ETR:ACX) CEO Compensation Package Needs To Be Put Under A Microscope

The results at bet-at-home.com AG (ETR:ACX) have been quite disappointing recently and CEO Franz Ömer bears some responsibility for this. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 18 May 2021. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. We present the case why we think CEO compensation is out of sync with company performance.

Check out our latest analysis for bet-at-home.com

How Does Total Compensation For Franz Ömer Compare With Other Companies In The Industry?

At the time of writing, our data shows that bet-at-home.com AG has a market capitalization of €321m, and reported total annual CEO compensation of €1.5m for the year to December 2020. That's a notable decrease of 15% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at €600k.

On comparing similar companies from the same industry with market caps ranging from €164m to €657m, we found that the median CEO total compensation was €537k. Hence, we can conclude that Franz Ömer is remunerated higher than the industry median.

Component	2020	2019	Proportion (2020)
Salary	€600k	€581k	41%
Other	€867k	€1.2m	59%
Total Compensation	€1.5m	€1.7m	100%

On an industry level, around 77% of total compensation represents salary and 23% is other remuneration. It's interesting to note that bet-at-home.com allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

bet-at-home.com AG's Growth

Over the last three years, bet-at-home.com AG has shrunk its earnings per share by 15% per year. In the last year, its revenue is down 8.4%.

The decline in EPS is a bit concerning. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has bet-at-home.com AG Been A Good Investment?

Few bet-at-home.com AG shareholders would feel satisfied with the return of -35% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 1 warning sign for bet-at-home.com that investors should be aware of in a dynamic business environment.

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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