It Looks Like Dermapharm Holding SE's (ETR:DMP) CEO May Expect Their Salary To Be Put Under The Microscope

Key Insights

• Dermapharm Holding to hold its Annual General Meeting on 27th of June
• CEO Hans-Georg Feldmeier's total compensation includes salary of €821.0k
• The overall pay is comparable to the industry average
• Over the past three years, Dermapharm Holding's EPS fell by 16% and over the past three years, the total loss to shareholders 43%

The results at Dermapharm Holding SE (ETR:DMP) have been quite disappointing recently and CEO Hans-Georg Feldmeier bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 27th of June. 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 Dermapharm Holding

How Does Total Compensation For Hans-Georg Feldmeier Compare With Other Companies In The Industry?

According to our data, Dermapharm Holding SE has a market capitalization of €2.0b, and paid its CEO total annual compensation worth €1.4m over the year to December 2023. This means that the compensation hasn't changed much from last year. We note that the salary of €821.0k makes up a sizeable portion of the total compensation received by the CEO.

For comparison, other companies in the German Pharmaceuticals industry with market capitalizations ranging between €934m and €3.0b had a median total CEO compensation of €1.2m. This suggests that Dermapharm Holding remunerates its CEO largely in line with the industry average.

Component	2023	2022	Proportion (2023)
Salary	€821k	€800k	60%
Other	€554k	€597k	40%
Total Compensation	€1.4m	€1.4m	100%

On an industry level, roughly 35% of total compensation represents salary and 65% is other remuneration. Dermapharm Holding is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Dermapharm Holding SE's Growth Numbers

Dermapharm Holding SE has reduced its earnings per share by 16% a year over the last three years. The trailing twelve months of revenue was pretty much the same as the prior period.

Overall this is not a very positive result for shareholders. And the flat revenue is seriously uninspiring. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Dermapharm Holding SE Been A Good Investment?

Few Dermapharm Holding SE shareholders would feel satisfied with the return of -43% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. 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 compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We did our research and identified 3 warning signs (and 1 which is potentially serious) in Dermapharm Holding we think you should know about.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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.

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