Shareholders Will Most Likely Find Gerresheimer AG's (ETR:GXI) CEO Compensation Acceptable

Key Insights

• Gerresheimer will host its Annual General Meeting on 5th of June
• Total pay for CEO Dietmar Siemssen includes €1.15m salary
• The total compensation is similar to the average for the industry
• Gerresheimer's total shareholder return over the past three years was 19% while its EPS grew by 4.3% over the past three years

CEO Dietmar Siemssen has done a decent job of delivering relatively good performance at Gerresheimer AG (ETR:GXI) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 5th of June. Here is our take on why we think the CEO compensation looks appropriate.

View our latest analysis for Gerresheimer

How Does Total Compensation For Dietmar Siemssen Compare With Other Companies In The Industry?

At the time of writing, our data shows that Gerresheimer AG has a market capitalization of €3.5b, and reported total annual CEO compensation of €2.7m for the year to November 2023. That's mostly flat as compared to the prior year's compensation. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at €1.2m.

On examining similar-sized companies in the Germany Life Sciences industry with market capitalizations between €1.8b and €5.9b, we discovered that the median CEO total compensation of that group was €2.4m. This suggests that Gerresheimer remunerates its CEO largely in line with the industry average.

Component	2023	2022	Proportion (2023)
Salary	€1.2m	€1.1m	43%
Other	€1.5m	€1.5m	57%
Total Compensation	€2.7m	€2.6m	100%

Talking in terms of the industry, salary represented approximately 49% of total compensation out of all the companies we analyzed, while other remuneration made up 51% of the pie. Gerresheimer 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.

Gerresheimer AG's Growth

Over the past three years, Gerresheimer AG has seen its earnings per share (EPS) grow by 4.3% per year. In the last year, its revenue is up 5.0%.

We'd prefer higher revenue growth, but it is good to see modest EPS growth. Considering these factors we'd say performance has been pretty decent, though not amazing. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Gerresheimer AG Been A Good Investment?

With a total shareholder return of 19% over three years, Gerresheimer AG shareholders would, in general, be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

To Conclude...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. However, we still think that any proposed increase in CEO compensation will be examined closely to make sure the compensation is appropriate and linked to performance.

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. We did our research and spotted 1 warning sign for Gerresheimer that investors should look into moving forward.

Switching gears from Gerresheimer, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.