Heidelberg Materials AG's (ETR:HEI) CEO Compensation Is Looking A Bit Stretched At The Moment

Key Insights

• Heidelberg Materials will host its Annual General Meeting on 15th of May
• Total pay for CEO Dominik von Achten includes €1.60m salary
• Total compensation is 94% above industry average
• Over the past three years, Heidelberg Materials' EPS grew by 2.3% and over the past three years, the total shareholder return was 299%

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Under the guidance of CEO Dominik von Achten, Heidelberg Materials AG (ETR:HEI) has performed reasonably well recently. 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 15th of May. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

See our latest analysis for Heidelberg Materials

How Does Total Compensation For Dominik von Achten Compare With Other Companies In The Industry?

According to our data, Heidelberg Materials AG has a market capitalization of €33b, and paid its CEO total annual compensation worth €8.7m over the year to December 2024. That's a notable increase of 26% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at €1.6m.

On comparing similar companies in the Germany Basic Materials industry with market capitalizations above €7.1b, we found that the median total CEO compensation was €4.5m. Accordingly, our analysis reveals that Heidelberg Materials AG pays Dominik von Achten north of the industry median.

On an industry level, roughly 49% of total compensation represents salary and 51% is other remuneration. Heidelberg Materials pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at Heidelberg Materials AG's Growth Numbers

Heidelberg Materials AG has seen its earnings per share (EPS) increase by 2.3% a year over the past three years. Revenue was pretty flat on last year.

We would prefer it if there was revenue growth, but it is good to see a modest EPS growth at least. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Heidelberg Materials AG Been A Good Investment?

We think that the total shareholder return of 299%, over three years, would leave most Heidelberg Materials AG shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar 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, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for Heidelberg Materials that investors should think about before committing capital to this stock.

Important note: Heidelberg Materials 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.