We Think Shareholders May Want To Consider A Review Of Branicks Group AG's (ETR:DIC) CEO Compensation Package

Key Insights

• Branicks Group's Annual General Meeting to take place on 22nd of August
• CEO Sonja Warntges' total compensation includes salary of €1.25m
• Total compensation is 302% above industry average
• Over the past three years, Branicks Group's EPS fell by 103% and over the past three years, the total loss to shareholders 86%

Shareholders will probably not be too impressed with the underwhelming results at Branicks Group AG (ETR:DIC) recently. At the upcoming AGM on 22nd of August, shareholders can hear from the board including their plans for turning around performance. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. From our analysis, we think CEO compensation may need a review in light of the recent performance.

See our latest analysis for Branicks Group

How Does Total Compensation For Sonja Warntges Compare With Other Companies In The Industry?

Our data indicates that Branicks Group AG has a market capitalization of €147m, and total annual CEO compensation was reported as €1.7m for the year to December 2023. That's a fairly small increase of 4.9% over the previous year. In particular, the salary of €1.25m, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the German Real Estate industry with market capitalizations ranging from €91m to €364m, the reported median CEO total compensation was €418k. This suggests that Sonja Warntges is paid more than the median for the industry.

Component	2023	2022	Proportion (2023)
Salary	€1.3m	€1.1m	74%
Other	€430k	€527k	26%
Total Compensation	€1.7m	€1.6m	100%

On an industry level, around 72% of total compensation represents salary and 28% is other remuneration. Branicks Group is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Branicks Group AG's Growth

Over the last three years, Branicks Group AG has shrunk its earnings per share by 103% per year. It saw its revenue drop 17% over the last year.

The decline in EPS is a bit concerning. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Branicks Group AG Been A Good Investment?

Few Branicks Group AG shareholders would feel satisfied with the return of -86% over three years. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. 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.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. In our study, we found 2 warning signs for Branicks Group you should be aware of, and 1 of them is potentially serious.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.