Shareholders Will Probably Hold Off On Increasing AlzChem Group AG's (ETR:ACT) CEO Compensation For The Time Being

Key Insights

• AlzChem Group will host its Annual General Meeting on 7th of May
• Total pay for CEO Andreas Niedermaier includes €315.0k salary
• Total compensation is 173% above industry average
• AlzChem Group's EPS grew by 21% over the past three years while total shareholder return over the past three years was 104%

Under the guidance of CEO Andreas Niedermaier, AlzChem Group AG (ETR:ACT) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 7th of May. However, some shareholders may still want to keep CEO compensation within reason.

Check out our latest analysis for AlzChem Group

How Does Total Compensation For Andreas Niedermaier Compare With Other Companies In The Industry?

According to our data, AlzChem Group AG has a market capitalization of €464m, and paid its CEO total annual compensation worth €1.5m over the year to December 2023. Notably, that's an increase of 84% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at €315k.

For comparison, other companies in the German Chemicals industry with market capitalizations ranging between €187m and €749m had a median total CEO compensation of €552k. Accordingly, our analysis reveals that AlzChem Group AG pays Andreas Niedermaier north of the industry median.

Component	2023	2022	Proportion (2023)
Salary	€315k	€315k	21%
Other	€1.2m	€503k	79%
Total Compensation	€1.5m	€818k	100%

Talking in terms of the industry, salary represented approximately 30% of total compensation out of all the companies we analyzed, while other remuneration made up 70% of the pie. In AlzChem Group's case, non-salary compensation represents a greater slice of total remuneration, 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.

AlzChem Group AG's Growth

Over the past three years, AlzChem Group AG has seen its earnings per share (EPS) grow by 21% per year. The trailing twelve months of revenue was pretty much the same as the prior period.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has AlzChem Group AG Been A Good Investment?

Most shareholders would probably be pleased with AlzChem Group AG for providing a total return of 104% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

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. That's why we did some digging and identified 1 warning sign for AlzChem Group that investors should think about before committing capital to this stock.

Important note: AlzChem Group 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.