Dolores Schendel became the CEO of Medigene AG (ETR:MDG1) in 2016, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Medigene.
Check out our latest analysis for Medigene
How Does Total Compensation For Dolores Schendel Compare With Other Companies In The Industry?
At the time of writing, our data shows that Medigene AG has a market capitalization of €85m, and reported total annual CEO compensation of €487k for the year to December 2019. We note that's a decrease of 14% compared to last year. Notably, the salary which is €350.0k, represents most of the total compensation being paid.
For comparison, other companies in the industry with market capitalizations below €164m, reported a median total CEO compensation of €553k. This suggests that Medigene remunerates its CEO largely in line with the industry average.
| Component | 2019 | 2018 | Proportion (2019) |
| Salary | €350k | €334k | 72% |
| Other | €137k | €234k | 28% |
| Total Compensation | €487k | €568k | 100% |
Speaking on an industry level, nearly 44% of total compensation represents salary, while the remainder of 56% is other remuneration. It's interesting to note that Medigene pays out a greater portion of remuneration through salary, compared to the 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 Medigene AG's Growth Numbers
Over the last three years, Medigene AG has shrunk its earnings per share by 7.3% per year. It saw its revenue drop 4.8% over the last year.
The decline in EPS is a bit concerning. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Medigene AG Been A Good Investment?
With a three year total loss of 72% for the shareholders, Medigene AG would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
As previously discussed, Dolores is compensated close to the median for companies of its size, and which belong to the same industry. On the other hand, EPS growth and total shareholder return have been negative for the last three years. Considering overall performance, shareholders will likely hold off support for a raise until results improve.
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 2 warning signs for Medigene that investors should think about before committing capital to this stock.
Switching gears from Medigene, 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. 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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About XTRA:MDG1
Medigene
A biotechnology company, focuses on the discovery and development of T-cell therapies for the treatment of cancer.
Moderate with adequate balance sheet.
